Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

PRIVATE BUSINESS

UNION THEOLOGICAL COLLEGE OF THE PRESBYTERIAN CHURCH IN IRELAND BILL [Lords]

BRITISH RAILWAYS BILL

As amended, considered; to be read the Third time.

Oral Answers to Questions — DEFENCE

HMS "Ark Royal"

Mr. Brotherton: asked the Secretary of State for Defence when he expects HMS "Ark Royal" to be withdrawn from service.

The Under-Secretary of State for Defence for the Royal Navy (Mr. A. E. P. Duffy): Our intention is that HMS "Ark Royal" should pay off at the end of this year.

Mr. Brotherton: Will the hon. Gentleman tell us what representations have been received from our NATO allies, particularly the United States, about the decision to phase out HMS "Ark Royal"? Secondly, will he tell us how long it will be after the "Ark Royal" has been phased out that the new through-deck cruiser will come into service, thereby telling us the period when there is no fixed-wing air support for the fleet?

Mr. Duffy: The hon. Gentleman will understand that such a departure should be a matter of profound interest to our NATO allies. I was glad to be in a position at Easter to discuss the matter with the Supreme Allied Commander, Atlantic,

when I visited him in North Virginia. Like our other allies, he understands why we need to act in fulfilment of longstanding plans, especially in support areas. The first through-deck cruiser is expected to become operational in the early 1980s, and I understand that my right hon. Friend will be making an early announcement about a further through-deck cruiser.

Mr. Alan Lee Williams: Is my hon. Friend satisfied with future arrangements for air protection for the Fleet in the 1980s?

Mr. Duffy: Yes, Sir, because the responsibility for fleet air defence will be transferred to the RAF. When the Sea Harriers are deployed afloat, they will be used to complement land-based air defence forces and provide quick reaction capability. In addition, of course, we shall benefit from the mutual support that we receive from our NATO allies.

Mr. Trotter: Is the hon. Gentleman aware that the United States Navy proposes to keep in service for a further 20 years aircraft carriers commissioned at the same time as HMS "Ark Royal"? Can he advise the House of a single reason for the removal from the fleet of the one remaining conventional carrier, the most powerful ship in the Navy, without any direct replacement, other than the reason of the Government's defence cuts?

Mr. Duffy: I understand the hon. Gentleman's concern, but he will be the first to recognise that there is nothing I can say now in furtherance of the reply that he was given on this very question on 9th May.

Mr. Churchill: Is the hon. Gentleman aware that we already have far too few air defence aircraft to protect even the United Kingdom, let alone to provide cover for the fleet until 1985 or beyond, when the ADV starts coming into service? Will there not be a severe gap in protection for the Royal Navy during that period, or will it not be at the expense of the United Kingdom itself?

Mr. Duffy: No, Sir. There will be no such gap, on the basis of the reply that I have already given to my hon. Friend the Member for Hornchurch (Mr. Williams).

Royal Air Force (Low Flying)

Mr. Woodall: asked the Secretary of State for Defence if he has plans to introduce a new low flying system for the Royal Air Force in the United Kingdom; and if he will make a statement.

The Under-Secretary of State for Defence for the Royal Air Force (Mr. James Wellbeloved): As I told the House on 3rd April, the air force department of the Ministry of Defence is carrying out a review of the present low flying system in the United Kingdom. Some changes have been agreed in principle by the Air Force Board, but a great deal of detailed work has still to be done to verify the feasibility of these changes and to ensure that the low flying is dispersed as evenly as possibly and causes as little inconvenience to the public as possible. I will consider making a statement to the House in due course.

Mr. Woodall: I am grateful for that somewhat limited reply, but can my hon. Friend tell us whether there is likely to be any increase in areas that will be affected by the low flying systems, and whether he will give maximum publicity to any new areas so affected and sympathetic consideration to any objections from some people who have particular interests against low flying?

Mr. Wellbeloved: The intention of the review is to seek to ensure that the RAF has adequate facilities in the United Kingdom to carry out its essential low flying training. The changes will increase the total area of the United Kingdom which falls within the low flying system.
As to the possibilities of publicity, one of the studies which are now in hand is to consider the best way in which this matter can be brought to the attention of the general public. My own view is that the time is fast approaching when we should publish in its entirety the low-flying system in this country.

Mr. Beith: Is the Minister aware that my constituents in Northumberland will welcome anything that he can do to spread the disruption caused by this necessary training as widely as possible among the whole of the inhabitants of the United Kingdom, all of whom benefit from the defence capability which it enhances?

Mr. Wellbeloved: I agree entirely that all of the people who reside in the United Kingdom and, indeed, in Western Europe, benefit from the ability of the Royal Air Force and other NATO air forces to be able to fly low and penetrate into a potential enemy's air space.
The Royal Air Force takes very seriously the complaints which are registered by the general public. As the hon. Gentleman is personally aware, we do everything within our power to try to mitigate the consequences upon the general public.

Mr. Michael McNair-Wilson: Will the Minister say whether, in his review, he will look at the question of compensation for loss of amenity caused by the noise of low flying aircraft, particularly over an area which may still be subject to having an operational air base in its midst? Will he also give some thought to the possibility of noise insulation being provided by his Department for houses which may be extremely badly affected?

Mr. Wellbeloved: Those matters are deserving of full consideration. As for compensation, people who suffer damage or loss resulting from proven activities of the RAF in low flying are entitled to make, and are asked by us to make, a claim to the Claims Commission. Such a claim will be properly evaluated and, if justifiable, compensation will be paid.
The greatest compensation that people who suffer from the disturbance caused by low flying can have is that the Royal Air Force is training itself to protect their freedom, their security and the peace of the world.

African Countries

Mr. Blaker: asked the Secretary of State for Defence if he has had discussions with the American Secretary of Defense and other Western Defence Ministers about the possible need for joint military operations to assist friendly countries in Africa.

The Secretary of State for Defence (Mr. Fred Mulley): I have discussed with the American Secretary of Defense and with the Defence Ministers of other Western Governments many matters of common and general interest, including, on occasion, current developments in Africa;


but I do not believe that any consideration of joint military operations in Africa is presently either desirable or necessary.

Mr. Blaker: Is not one of the lessons of Zaire that there should be joint contingency planning between various European Governments and the Americans, if they would join in, so that if a similar situation, unhappily, were to occur in future, a joint European rescue force could be sent at the request of an African Government?

Mr. Mulley: That is a point of view, but I think that it would be extremely difficult to foresee all the various different scenarios, and difficult to get one group of European countries to agree to a common plan. Last week we were asked to consult the other countries involved, and we did so. That, I think, is probably the best way in which to approach that kind of situation. We were asked on humanitarian grounds to provide airlift and medical facilities, and we did so.

Mr. Bryan Davies: Is there not an absolutely critical difference between intervention in order to protect our own nationals and their security, and intervention in order to assist foreign Governments, which is what the hon. Member for Blackpool, South (Mr. Blaker) is suggesting? Is that not precisely the kind of thing that led the Americans into the morass of Vietnam?

Mr. Mulley: I certainly see a very clear distinction, as my hon. Friend indicates. Of course, it is open to sovereign Governments to ask other countries for military advice and assistance, but I think it would be right to judge each request on its merits as it arises.

Mr. Pattie: Does the Secretary of State think that if the Government had to engage in a rescue operation involving British subjects, we would have the capability to carry it out?

Mr. Mulley: It is very difficult to answer a question of that world-wide character, but I would think in most cases, certainly, yes.

Mr. Dalyell: May we take it that, on the very narrow issue of consultation with the British Government, the Secretary of State is wholly satisfied with what happened over Zaire?

Mr. Mulley: I do not know that it is for me to express views which are more properly within the field of my right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs, but certainly I can say that from the time the Royal Air Force and the Army units concerned were requested, they were dispatched rapidly and did all that they were called upon to do.

Rear-Admiral Morgan-Giles: Is there not an obligation upon the right hon. Gentleman, as Secretary of State, to make contingency plans to protect British nationals and British interests, wherever they may be threatened, rather than giving the parliamentary reply that such operations are neither desirable nor necessary?

Mr. Mulley: I think that it is certainly my job to defend British interests, but the proposition that any British national in any part of the world can demand military assistance became outdated at the time when Palmerston was Foreign Secretary.

Dockyard and Shore Establishment Workers (Pay)

Mr. William Hamilton: asked the Secretary of State for Defence what representations he has received concerning the low basic wage rates paid to employees at Rosyth Dockyard and establishments such as HMS "Caledonia", HMS "Cochrane", and HMS "Lathalmond"; and what reply he has given.

The Minister of State, Ministry of Defence (Dr. John Gilbert): I have received no formal representations but I am aware of the current campaign sponsored by the Transport and General Workers Union and of public statements made by the national officers of some trade unions about the need for improvement in the basic wage rates of the Industrial Civil Service as a whole. A claim for an increase for the whole Industrial Civil Service under stage 3 of the pay policy has now been tabled.

Mr. Hamilton: Does my right hon. Friend realise that when the mass lobby took place a fortnight or so ago, a large number of those people from Scotland were from Rosyth and the establishments mentioned in the Question? They claimed that their basic wage was about £32 a week. If that is the case, does he not think that that is quite scandalous? Can


he say how that basic rate compares with average earnings?

Dr. Gilbert: The figures that I have in front of me show that craftsmen's average earnings are about £69 a week and that non-craftsmen's earnings range between £51 and £60 a week. The craftsmen's basic rates are about £51·50, including supplement paid under stage 1 and stage 2 of the pay policy. As my hon. Friend will be aware, under the pay policy, industrial civil servants have had the maximum amount by way of supplements ever since 1975, and there will be a new settlement date on 1st July next.

Mr. Evelyn King: Will the Minister tell us what is the take-home pay of a semi-skilled worker at a dockyard in Portland? Is it a fact that it is about half what a worker of similar skills would earn in the motor industry in Birmingham? Will he tell us why this is so?

Dr. Gilbert: The hon. Gentleman puts his question in very general terms. One needs to know about the family circumstances of people before talking about their take-home pay. But the wider question is a matter for my right hon. Friend the Minister for the Civil Service.

Arms Sales (Aldershot Exhibition)

Mr. Hugh Jenkins: asked the Secretary of State for Defence if he has now drawn up a full list of companies participating in the private arms trading fair at Aldershot in June and of countries to be invited to send representatives; and if he will publish these lists.

Dr. Gilbert: A provisional list of companies participating in the British Army Equipment Exhibition was published in the Official Report on 18th May. It is not the practice to release information about sales or potential sales of defence equipment.

Mr. Jenkins: Is my right hon. Friend aware that this arms fair coincides with the United Nations Special Session on Disarmament? Has he noticed Early-Day Motion No. 438, which calls upon Her Majesty's Government to demonstrate their devotion to disarmament, rather than to rearmament, by cancelling the fair and concentrating on the Special Session?

Dr. Gilbert: I have indeed noticed the Early-Day Motion to which my hon. Friend refers. I am quite confident that the initiatives that my right hon. Friends the Prime Minister and the Foreign Secretary are contemplating taking in New York will bear fruit. We need to keep these things in some sort of perspective. The United Kingdom is responsible for only about 5 per cent. of global sales of defence equipment.

Mr. Critchley: Is the Minister aware that the Aldershot arms fair is of very great assistance in the export of British arms, without which, rightly or wrongly, the whole of our arms expenditure would be very much higher?

Dr. Gilbert: There is no question but that arms exports help to keep down the cost of equipment to the United Kingdom Forces, in so far as they relate to equipment that is being used by the Services. The Government want to see a reduction in multilateral transfers of armaments, but that has to come through agreement between both suppliers and customers.

Mr. Litterick: Does my right hon. Friend accept that the Secretary of State has always maintained that the British Government's arms sales policy has always been a discriminating one? Will he therefore tell us to whom, apart from Chile and E1 Salvador, his Department will not sell arms?

Dr. Gilbert: Normally we do not give details of countries that are not eligible for sales of defence equipment, but the answer to my hon. Friend is "South Africa".

Mr. Ron Thomas: asked the Secretary of State for Defence what representations he has received in regard to the proposed arms exhibition at Aldershot; and if he will make a statement.

Dr. Gilbert: Letters have been received from Members of Parliament and members of the public, and Questions have been tabled in the House. The Government are aware that some people are concerned at the coincidence of the British Army Equipment Exhibition with the penultimate week of the United Nations Special Session on Disarmament, but are confident that this will not detract from the effort of my right hon. Friends


the Prime Minister and the Foreign and Commonwealth Secretary in New York.

Mr. Thomas: Is my right hon. Friend aware that many of us feel that there is a real sense of hypocrisy here, in that we are having this arms exhibition at the same time as the world leaders are trying to get agreement on disarmament? Will he get together with the Secretaries of State for Industry and Trade to see how we can use the innovating skills of the workers involved in order to reduce the imports of finished and semi-finished manufactured goods and to produce socially necessary products along the lines of the Lucas Aerospace proposals?

Dr. Gilbert: No one is keener than Defence Ministers to see a reduction in the world's trade in armaments. Unfortunately, the world in which we live is such that it does not permit us to do so. The way to get a reduction in arms sales is through multilateral agreement with the major suppliers and customers. That is what my right hon. Friends will be attempting to do in their initiatives in New York.

Mr. Rhodes James: Is the right hon. Gentleman aware that the true author of this Special Session of the United Nations is my former colleague, Mr. Arkadiy Shevchenko, who, having realised the error of his ways, has now changed sides?

Dr. Gilbert: I am obliged for the information.

Mr. Stoddart: Is it not the proliferation of arms throughout the world which causes tragedies such as those we have seen in Zaire? Would it not have been far better if the Government had sought to limit the sale of arms rather than to promote it? If the Government cancelled the exhibition at Aldershot would not that strengthen their moral authority when they go to the United Nations?

Dr. Gilbert: I take the force of the first point made by my hon. Friend. Of course, the accumulation of arms carries risks in itself. But I cannot see that a self-denying ordinance by the United Kingdom—when other suppliers and customers have no intention of reducing either their supplies or demands for arms—would do anything other than contribute

to further unemployment in this country.

Employment (Alternative Opportunities)

Mr. George Rodgers: asked the Secretary of State for Defence what recent consultations have taken place with a view to providing alternative employment opportunities for those people who have lost jobs following adjustments to the defence programme.

Dr. Gilbert: Some overall loss of employment opportunities has inevitably resulted from reductions in the defence budget. It is not possible for the Ministry of Defence to provide alternative job opportunities in the defence industries within the present agreed level of defence spending.

Mr. Rodgers: Is my right hon. Friend acquainted with the procedures that took place in the United States in the wake of the Vietnam war, when the Government concentrated attention, funds and resources upon those areas that were deprived of defence employment? As a consequence, in many cases those areas are now extremely prosperous, due to alternative work. Is he further aware of the corporate plan produced by the Lucas shop stewards, which again shows great enterprise and points the way in which we could devote our resources and energies to civilian production, thereby creating employment as well as prosperity?

Dr. Gilbert: I am aware of both the matters to which my hon. Friend alluded. With regard to the Royal Ordnance factories and the dockyards—the defence procurement activities for which the Minister of Defence is directly concerned—there is no shortage of employment in either. In fact, they are fully loaded for some years ahead. The conversion of activity on the part of private firms is very much a matter for them.

Mr. Kenneth Lewis: Does not the Minister of State agree that if the Government would stabilise the defence programme and not keep cutting it there would not be so many jobs lost and the structure of advancement for people employed in the industry would be all the better?

Dr. Gilbert: It may have escaped the hon. Gentleman's attention that the Government have announced a 3 per cent. increase in the defence programme.

Sir Ian Gilmour: Will the right hon. Gentleman now give up-to-date figures showing how many jobs and job opportunities in the Services and in civilian life—in industries and elsewhere—have been lost by the defence policy of the Government?

Dr. Gilbert: The right hon. Gentleman is fully aware of the up-to-date figures of the job loss in both cases. As I have told his hon. Friend the Member for Stretford (Mr. Churchill) on many occasions, it is not the function of defence expenditure to provide employment as such. Defence expenditure is related to the necessary requirements of the defence of this country.

Sir Ian Gilmour: The right hon. Gentleman should answer the question. I quite agree that it is not the function of defence expenditure to provide jobs, but I asked how many jobs have been lost. What is the answer?

Dr. Gilbert: I have absolutely nothing to add to the answers which I have already given the right hon. Gentleman on that subject.

Arms Sales (China)

Mr. Clemitson: asked the Secretary of State for Defence what plans the British Defence Sales Organisation has for promoting arms sales to China.

Mr. Mulley: The British Defence Sales Organisation is ready to respond to Chinese interest in British defence equipment, taking into account the usual political, strategic and economic criteria and our international obligations.

Mr. Clemitson: Does my right hon. Friend accept that the Conservative Opposition have no monopoly of opposition to the totalitarian ways of the Soviet authorities? Does he agree that it would be very foolish to cultivate the friendship of China merely as part of a crude anti-Soviet policy? Will he therefore think very carefully before the sale of arms to China is either promoted or authorised?

Mr. Mulley: I can certainly give my hon. Friend the assurance that no authority

will be given without the most careful consideration. As my hon. Friend knows, my right hon. Friend the Foreign Secretary has already made clear that while we desire and seek to improve our relations with China we do not wish to do so at the expense of worsening our relations with the Soviet Union.

Mr. Churchill: Will the Secretary of State confirm that the Government do not see the People's Republic of China as either a hostile or potentially hostile country? Will he confirm that there is no bar to the sales of British defence equipment.

Mr. Mulley: As I have said, no decisions on this matter have been taken. In fact, there have been no firm indications of which equipment is wanted. Everyone assumes that it is the Harrier that is likely to be wanted by China, but I have no reason to think that that is necessarily the case. China has given no firm indications of what it might be interested in. As no decisions have been taken, I cannot announce them.

Mr. Litterick: Does my right hon. Friend agree that he has no way of knowing how a customer State is likely to use any military equipment supplied by us to it? For instance, no one knows that it would not be used for an oppressive purpose. Is my right hon. Friend aware, for example, that British armoured vehicles were used to suppress the recent demonstrations in Tabriz, in Iran?

Mr. Mulley: Whatever view may be taken about the sale of arms to China, somehow I do not feel that that would have a bearing on my hon. Friend's present concern.

Mutual and Balanced Force Reduction Talks

Mr. Watkinson: asked the Secretary of State for Defence if he remains satisfied with the progress so far as it affects British defence policy, of the Mutual and Balanced Force Reduction talks in Vienna.

Mr. Mulley: Far from being satisfied, as I told the House in the recent defence debate on 13th March,
I cannot conceal my disappointment at the lack of progress".—[Official Report, 13th March 1978; Vol. 946, c. 46.]


However, events in the fourteenth round, which ended on 19th April, including the new proposals tabled by the West, give grounds for hope that we can overcome the impasse in the talks.

Mr. Watkinson: Does my right hon. Friend agree that a large measure of the blame for the lack of progress in these talks must attach to the Soviet Union? However, did he notice that in the recent Schmidt-Brezhnev talks, Mr. Brezhnev did indicate a slight movement in favour of force reduction in the central front area? Will he seek to build upon that initiative and do all he can to inject some urgency into these vital talks?

Mr. Mulley: I entirely agree with my hon. Friend about the importance and the desire for urgency. I noted also the communique from the Schmidt and Brezhnev talks and I hope that that can be followed up on the Soviet side. A great deal of the delay has arisen through the difficulty of getting from the Warsaw Pact countries the necessary data on which any agreement must be based. As is widely understood, there is a disparity because the Warsaw Pact forces are substantially greater in numbers than our own.

Mr. Wall: Does the Secretary of State agree that there has been no progress in Vienna? Will he do everything he can to checkmate the Russian design to prevent the cruise missile being deployed in Europe, as this weapon is essential to the future of NATO?

Mr. Mulley: Discussions about the cruise misile do not arise in the Vienna talks. On that matter I cannot assist the hon. Gentleman.

Mr. Norman Atkinson: Will the Minister confirm that it is the Government's policy to achieve balanced force reductions and parity between NATO and Warsaw Pact countries? Will he explain how it is possible to move towards parity if there is no understanding about the respective forces mobilised in either NATO or the Warsaw Pact countries? Does he still think it feasible that we can negotiate on the basis of demanding from the Soviet Union a reduction of 250,000 troops, as against a reduction of 100,000 from NATO?

Mr. Mulley: It is the Government's desire and policy to achieve balanced

force reductions. However, before we can do that agreement is needed by both sides. Agreement is also needed on the numbers involved. On the NATO side, not only are the figures freely published; people can go and count them for themselves. The Warsaw Pact does not give the information the same publicity. In the negotiations it has not been possible so far to reach agreement on common figures on which further steps could be taken before we reach a balance.

Mr. Hooson: Does not the attitude of the Soviet Union to date suggest that it is not keen on achieving arms reduction in Europe? Does not the Soviet Union's attitude towards the particularly strong tank forces on the eastern border of Western Europe indicate that the Soviet Union has no intention to negotiate on that matter?

Mr. Mulley: It could be fairly inferred that if the Soviet Union wants progress it is hastening rather slowly. My hon. Friend's point in raising the question was whether we can infer—I think that it is too soon—from Mr. Brezhnev's remarks in Western Germany that a new political initiative will be forthcoming. We shall have to wait and see.

Mr. Flannery: Does my right hon. Friend agree with me that it is not conducive to detente and disarmament for the Chief of the Defence Staff to go careering round the world describing the Soviet Union as the enemy, apparently with the full backing of the Conservative Party in this country, which means that it is a very important statement? Will he, therefore, state to the world that we do not regard the Soviet Union as the enemy and that we want peace with all nations?

Mr. Mulley: I should correct my hon. Friend. To the best of my knowledge, the Chief of the Defence Staff has not careered round the world making these observations. He made one indiscreet and inaccurate remark on one occasion. The fact that the Conservative Party behaves as it does, is, I am happy to say, not my responsibility. I only hope that the British people will note the Conservative Party's antics in the House and will record their verdict when the time comes, so that the Conservative Party stays on the Opposition side of the House.

Sir Ian Gilmour: Talking about party antics, does the Secretary of State not


agree that it is well known throughout the West how many Soviet troops are facing us on the Western Front? Does he agree that it is odd that the hon. Member for Tottenham (Mr. Atkinson), who is the treasurer of the Labour Party, should support the Soviet position?

Mr. Norman Atkinson: On a point of order. Will you, Mr. Speaker, call upon the right hon. Gentleman to substantiate the comment that he just made?

Mr. Speaker: Order. I could not hear the last remark of the hon. Member for Tottenham (Mr. Atkinson). I know that the hon. Gentleman was protesting, but I could not hear him for the noise. I trust that the right hon. Member for Chesham and Amersham (Sir I. Gilmour) was not making a personal charge.

Sir I. Gilmour: I asked a straightforward question. I asked whether the Secretary of State could explain why the treasurer of the Labour Party—the Secretary of State had been talking about party antics—was supporting the Soviet position in the MBFR talks.

Mr. Atkinson: I wonder whether you could help the House, Mr. Speaker, in demanding that the right hon. Member for Chesham and Amersham (Sir I. Gilmour) should substantiate a statement such as that. In the questions that I have put to my right hon. Friend, I have said nothing, implicit or otherwise, from which the right hon. Member for Chesham and Amersham could deduce my support for the Soviet Union against the interests of this country.

Several Hon. Members: rose—

Mr. Speaker: Order. The hon. Member for Tottenham has made his position perfectly clear. I deprecate personal attacks.

Mr. Mulley: The fact that the right hon. Member for Chesham and Amersham (Sir I. Gilmour) made the attack on my hon. Friend in the guise of a question to me in no way excuses the attack. My hon. Friend is in no way supporting the interests of the Soviet Union against this country. The dragging in of the fact that my hon. Friend is treasurer of the Labour Party will be deprecated by everyone in the House.

Sir I. Gilmour: The Minister talked about party antics. I was explaining to the Secretary of State that the West knows perfectly well how many Soviet troops there are in Eastern Europe. The treasurer of the Labour Party pretended that that was not known and that it was a matter of doubt. That is the Soviet position. It is not the West's position.

Mr. Speaker: Before we move to the next Question, may I say that I am assuming that there is no reflection at all on the hon. Member for Tottenham.

RAF Married Quarters (Redecoration)

Mr. Arnold Shaw: asked the Secretary of State for Defence if he will review the regulations governing the redecoration of RAF married quarters to enable airmen to exercise an option of carrying out redecorations themselves.

Mr. Wellbeloved: Airmen are already permitted to carry out limited internal redecoration on a self-help basis, for which they can borrow, free of charge, materials, brushes and other equipment from the Property Services Agency.
Internal redecoration is carried out approximately every four years by the PSA, in addition to selective redecoration on change of occupancy. At present, choice of wall colouring is limited to eight pastel shades for walls, while paintwork is a standard brilliant white.
I appreciate that some occupants might prefer a wider range of decorating options and I am arranging for the current regulations to be reviewed to see whether it is possible to introduce a more liberal policy. This review will, of course, take into account the views of both the PSA and PSA employees' representatives.

Mr. Shaw: I thank my hon. Friend for that reply, as far as it goes, but can he assure the House that when he reviews the situation there will be full freedom of choice of materials, colour schemes, and so on? Will he make certain that there are safeguards for the existing workforce?

Mr. Wellbeloved: I am deeply interested in trying to improve the quality of life in the Royal Air Force. Therefore, I take seriously the question of providing wider options for airmen to decorate their quarters. In the review that is taking place we shall take into account not only


the views of the Property Services Agency but the views of the trade unionists employed by that organisation.

Armed Forces (Trade Union Representation)

Mr. Hoyle: asked the Secretary of State for Defence what representations he has received from trade unions requesting recruitment facilities, in order to persuade members of the Armed Forces to join trade unions.

Mr. Mulley: I have received one such request, from the Association of Scientific, Technical and Managerial Staffs.

Mr. Hoyle: Will my right hon. Friend look favourably upon the one request which he has received and upon other requests which he may receive, to allow trade unions to pursue a policy of recruiting members of the Armed Forces?

Mr. Mulley: I listened to the full and fair statement by my hon. Friend yesterday on behalf of his union. As I have told him on previous occasions, until it is clear what trade unions could do for the Armed Forces I would not think it right to encourage a widespread recruiting campaign on the lines that my hon. Friend has in mind.

Mr. Goodhart: While I agree with the latter part of the right hon. Gentleman's reply, may I ask whether he is aware that if he had to meet trade union negotiators he could not possibly get away with the negative replies that he has been giving to questions about the future of the local overseas allowance? Can he give us a pledge that this year's meagre pay increase for the Services will not be eroded by a cut in local overseas allowance, which makes up 40 per cent. of the pay of our Service men in BAOR?

Mr. Speaker: Order. That is a quite separate question from that which appears on the Order Paper.

Mr. Mulley: I would like to answer it, Mr. Speaker because it was last year that the hon. Member for Beckenham (Mr. Goodhart) and some of his hon. Friends were going around saying that the local overseas allowance was to be reduced by 40 per cent. This turned out to be totally wrong. I see that they are starting in May this year instead of August. As the hon. Member knows, the

whole matter is under review and I cannot anticipate anything. I express the hope that the hon. Gentleman will not begin his campaign to undermine the morale of the British Army of the Rhine earlier this year than he did last year.

Harrier Aircraft (Sales)

Mr. Arnold: asked the Secretary of State for Defence what is his policy towards the sale of Harriers to the People's Republic of China.

Mr. Hal Miller: asked the Secretary of State for Defence whether there are any procedural obstacles still to be overcome before the United Kingdom could respond favourably to a request from the Chinese People's Republic to purchase Harriers.

Mr. Mulley: If the Chinese interest in Harrier is confirmed, the usual political, strategic and economic criteria and our international obligations in relation to the sale of Harrier would have to be examined in detail before Her Majesty's Government could take a considered view.

Mr. Arnold: Can the right hon. Gentleman say whether the United States Government have now withdrawn any objections which they may have had to an arrangement of this nature? Given that the Press in the United Kingdom has been talking about the sale of 30 Harriers to China, with the possibility of building another 300 under licence, what assessment has the Secretary of State made of the way in which this would affect the balance of air power in the Far East?

Mr. Mulley: I am glad to say that it is no part of my responsibility to answer for or accept Press statements. We have had no indications about a sale, let alone a sale with the detail which the hon. Gentleman seems to have read in the Press. The procedures for discussing sales of this sort with our allies can be put into operation only when there is a firm proposition to be considered. We have not, therefore, gone through the COMCO procedure.

Mr. Miller: Can the Secretary of State assure the House that we shall not be left in a chicken-and-egg situation? Is he aware that the Chinese are not likely to ask if they are to be refused? Cannot he be a little more forthcoming and tell us


what degree of interest the Chinese have to show before the procedures are put into motion?

Mr. Mulley: As I explained, it is a bad practice to announce decisions before they have been taken, and no decisions affecting this matter have been taken.

Mr. John Evans: Would my right hon. Friend care to comment on the fact that the British Conservative Party, which for generations has had nightmares about "Reds under the bed", is now hand in glove with the Communist People's Republic of China? Will he tell the House whether that makes the Conservatives into Marxists? Will he make sure that we do not sell planes of this nature to any Communist country?

Mr. Mulley: The enthusiasm shown for the Chinese People's Republic by the Conservative Party will have been noted in many quarters. While I welcome the widening of the Conservatives' international horizons, I am not sure that I would go as far as some Tory Members in that direction.

Armed Forces (Service Records)

Mr. Canavan: asked the Secretary of State for Defence what access his Department gives to the Service records of members and ex-members of the Armed Forces.

Dr. Gilbert: The Service record of a member or ex-member of the Armed Forces is normally disclosed only with his consent.

Mr. Canavan: Will my right hon. Friend take all the necessary steps to ensure that there is no leak of any information which could be used by unscrupulous recruiting agencies, especially in view of recent reports that British ex-Service men are operating as mercenaries in Rhodesia?

Dr. Gilbert: I certainly undertake to act as my hon. Friend requests. If he has knowledge of any cases in which information has leaked out without the consent of a Service man I shall be happy if he will bring them to my attention.

Armed Forces (Strength)

Mr. Gow: asked the Secretary of State for Defence how many officers and

men left the Armed Forces of the Crown during the first four months of 1978; what were the equivalent figures for the first four months of 1977 and 1976; and whether he is satisfied with the present strength of the Armed Forces.

Mr. Mulley: Figures for all three Services up to the end of April are not yet available. The number of officers and men who left the Armed Forces during the three months January-March in each of the last three years was: 1976, 11,105; 1977, 10,967; 1978, 11,166.
The trained strength of all three Services is generally in line with present requirements and I am confident that the Services are able to meet their commitments.

Mr. Gow: Is it not a matter of great convenience for the Secretary of State that the first figure for which he was asked is not available? Is it not the case that when that figure is available it will reveal a most disquieting trend? Does he understand that unless he substantially increases the pay of the Armed Forces the erosion in their numbers will continue?

Mr. Mulley: I do not think that it is unreasonable that the first figure for which I was asked is not to hand, since it could have been available only three weeks ago. I will see that the figures are published as soon as possible. I do not think that the overall position is anywhere near as bad as some Tory Members suggest, but there is no room for complacency. There is concern about shortages and the failure to recruit some key personnel, particularly pilots—where the standard is very high—enginers, and so on. I assure the hon. Gentleman that we are extremely concerned about the trend and will do all that we can to abate the outflow.

Oral Answers to Questions — TARPORLEY

Mr. Goodlad: asked the Prime Minister if he will pay an official visit to Tarporley.

The Prime Minister (Mr. James Callaghan): I have at present no plans to visit Tarporley.

Mr. Goodlad: Will the Prime Minister accept that were he to make such a visit he would encounter serious concern about recent events in Kolwezi, where so many


Europeans have been senselessly slaughtered? In view of the limited and unsatisfactory assurances just given by his right hon. Friend the Secretary of State for Defence—

Mr. Speaker: Order. We must have some regard to the Order Paper. Will the hon. Gentleman link his supplementary question, somehow, to a visit to Tarporley?

Mr. Goodlad: Is the Prime Minister aware that if he were to visit Tarporley he would encounter serious concern about recent events in Kolwezi? Is he satisfied that following the defence cuts which the Government have made we have sufficient capability to protect British lives throughout the world as the French have done in Zaire?

The Prime Minister: The hon. Member's supplementary question is totally unrelated to the problems of Tarporley. If, as I had hoped, the hon. Gentleman intended to ask a question about the trunk road A49, or the proposal to close the Tarporley War Memorial Hospital, or the proposed closure of the Oakmere Rehabilitation Centre, I would have been able to tell him—on the last point—that I am glad to say that the proposals of the area health authority to close the centre down will not be approved by the Minister and that this rehabilitation centre will be kept open and its future will be decided again in five years' time.

Oral Answers to Questions — PRIME MINISTER (ENGAGEMENTS)

Mr. Hoyle: asked the Prime Minister if he will list his official engagements for 23rd May.

The Prime Minister: In addition to my duties in this House, I shall be holding meetings with ministerial colleagues and others.

Mr. Hoyle: Arising from the admirable speech he made to the CBI last week, may I ask my right hon. Friend to take some time between his engagements to consider the possibility that since £1 out of every £4 is spent on manufactured goods from abroad, we might introduce selective import controls to protect key industries, such as the motor car and electronics industries,

which are threatened by Japan and, perhaps, introduce further measures to protect the footwear and textile industries?

The Prime Minister: As my hon. Friend said in the last part of his supplementary question, selective import controls are already in existence in the textile and footwear industries. As for the motor car industry, undertakings have been given by the Japanese Government which we expect them to carry out in view of the serious rise in imports of Japanese vehicles. I take note of the other point that my hon. Friend made about the electronics industry. The Secretary of State for Industry will, of course, be ready to look at it.

Mr. MacKay: During his busy day will the Prime Minister find time to commend the remarks of his right hon. Friend the Chancellor of the Duchy of Lancaster, who said yesterday that this Government's unemployment protection legislation had caused much of the unemployment in this country? Will the Prime Minister also acknowledge that Members on the Opposition Benches have been telling him for a long time that unemployment has been caused by his Government's policy? Will he now change it?

The Prime Minister: I do not accept the hypothesis, therefore I certainly do not rush to the conclusions that the hon. Member has drawn. It is quite untrue that this legislation has added to unemployment. It is protecting employment in a way that the Opposition would destroy if their policy of removing all subsidies and grants were ever carried into effect. As it seems unlikely that it ever will be, I am very glad to say that that fear will be removed from the British people.

Mr. Mike Thomas: Will the Prime Minister accept that while there has been a welcome drop in unemployment figures, in the Northern Region they still stand at 8·2 per cent.—the highest in Britain? Has he any further proposals to deal with that situation?

The Prime Minister: Yes. The further proposals are that we should keep steadily and firmly attacking the problem of inflation. The reason why unemployment is coming down is that our measures


are succeeding and that we are overcoming inflation. There is still a long way to go, and if we can reduce inflation even further we shall avoid throwing more people out of jobs through our failure to be competitive. That is the message that I ask my hon. Friend and all hon. Members to convey to their constituents.

Mr. Temple-Morris: In spite of his answer to my hon. Friend the Member for Birmingham, Stechford (Mr. MacKay), no doubt the Prime Minister has had time today to consider the very serious events in Zaire. In view of the utterly inadequate replies that we have had today from the Secretary of State for Defence, will he say whether he has any plans to launch talks with our European allies in order to get some sort of co-ordinated action in any future African rescue operations?

The Prime Minister: It is not the responsibility of the Secretary of State for Defence to conduct those discussions; it is for the Foreign Secretary. He has already intimated that he is in the course of talks with his colleagues in Europe so that whenever a situation of this nature arises in Africa we can be certain of protecting our own citizens.
I am very glad that the French and Belgian troops were able to protect their citizens in Zaire. I hope that they will not pursue this any further, but that there will be a withdrawal at the appropriate time when they have evacuated all their citizens.

Mr. Gould: Has the Prime Minister seen today's reports of the meeting of EEC Finance Ministers? Will he look very carefully and cautiously at the snake, the emu and, indeed, any other creature whose object it is to preserve the current pattern of distribution of trade surpluses and deficits? Does he agree that our interests in these matters may be very different from those of countries which have been and still are in massive surplus?

The Prime Minister: I always look very carefully and cautiously at any snake that may cross my path—of whatever character. As far as this reptile is concerned, I would certainly look a gift horse in the mouth and examine what its teeth are made of. But I do not think

that we should rule out all these matters on grounds of ideology. There are clearly advantages in getting a greater stabilisation of currencies—if this is possible—to avoid the great swings that are taking place. Therefore, we shall look at all these schemes on their merits.

Mrs. Thatcher: May I return to the events in Zaire and ask the Prime Minister whether, after the defence cuts, particularly in RAF Transport Command and in the training of paratroopers—where the cuts have been severe—he is satisfied that this Government would still have the military capacity to rescue British citizens in similar circumstances to those in Zaire?

The Prime Minister: The Leader of the Opposition is entitled to ask the question, but I hope that she will not cast any doubts on our capacity to handle this matter. That is a perfectly proper remark for me to make in view of the attitude of the Opposition about defence matters over the past 12 months. This country is quite capable of entering into agreements with the countries where this sort of incident might take place—

Mr. Wiggin: Incident?

The Prime Minister: The hon. Gentleman need not pick up every word—as I was saying, we are quite capable of entering into agreements with countries where an incident takes place which might affect the lives of British citizens, in order to ensure that they are safeguarded. I regard that as a basic responsibility, and I have satisfied myself that we can do it.

Mrs. Thatcher: With due respect, I ask the Prime Minister whether, after the cuts which have particularly affected paratroopers, this country—[Interruption.]

Mr. Speaker: Order. The right hon. Lady is entitled to ask her question.

Mrs. Thatcher: Does this country alone have the capacity to mount such an operation after defence cuts, particularly those that have affected RAF Transport Command and paratroopers?

The Prime Minister: It is clearly not possible to give a general answer of this kind in a hypothetical situation which no one knows will arise. But, generally speaking, the capacity to look after the lives of our citizens is there and it would


be used, either alone or in conjunction with our allies.
It seems to me that the right hon. Lady is not drawing the right conclusion when she says that we should be able to act alone. Surely the lessons of Zaire are that it is far better to act in co-operation. That is why the Royal Air Force made British transport available to the authorities who went into Zaire—transport which, fortunately, was not needed. I hope that if a similar position arises in which a number of British citizens are involved, we shall be able to get support of that sort from our allies. That is the best way of approaching the matter.

Mr. Pardoe: Could the Prime Minister look at the front page of today's Daily Mirror and consider the ethics and the merits of the publication of opinion polls? Does he understand that we are now in the run-up to an election and we have a situation in which opinion polls showing a Labour lead are published by the NOP in the Daily Mirror, while those published in the Daily Mail always show a Conservative lead?

Mr. Tebbit: Which ones show a Liberal lead?

Mr. Pardoe: Will the Prime Minister also comment on the curious paradox that this kind of news selection when practised by the editor of the Daily Mail is essential freedom of the editor but when practised by the printers is a disastrous interference with free communication?

The Prime Minister: My experience is that the editor of the Daily Mail is too tender a plant for me to make any comments about. I am sure that he would be far too upset if I did. I did
read the very interesting report on page 1 of the Daily Mirror, but I found page 2 more significant on this occasion—

Mr. Skinner: What about page 3?

The Prime Minister: No, not page 3. It was page 2 that I was interested in. Page 2 of the Daily Mirror showed the attitude taken by the conference of the Union of Post Office Workers about inflation and next year's wage round. I found that extremely heartening.

Mr. Molloy: Does my right hon. Friend agree that recent news is very

welcome in the fight against inflation and unemployment, and that much of this is due to the policies of this Government and the co-operation of other Governments with whom my right hon. Friend has been in contact? Will he consider approaching the TUC and asking it to consider a conference of the International Confederation of Free Trade Unions, which, I believe, would be prepared to contribute to overcoming inflation and reducing world-wide unemployment?

The Prime Minister: I have discussed this matter with the TUC. It is in touch with its colleagues in European trade unions in other member States of the Community with a view to examining the measures that could be pressed upon Governments in order to ensure that there is a further welcome drop in unemployment.

Mr. Donald Stewart: Will the Prime Minister keep in mind, to weigh up against the Establishment's support of Mr. Tom Jackson, the speech made by Mr. Joe Gormley, in which he said that British trade unions were in the same trap as trade unions in Communist countries, as they did not have the right of free collective bargaining? Will the right hon. Gentleman assure us that there will not be a phase 4 of wage restraint?

The Prime Minister: There are differences of view in the trade union movement about these matters, but it is quite clear that the unions that are more closely associated with the public sector recognise clearly that the sort of situation that we had in the early 1970s is not productive of a permanent improvement in the standard of life of their members. Therefore, it behoves us all to search for better methods of securing a real improvement in the standard of life.

Mr. Noble: May I return to the original Question? During my right hon. Friend's engagements today will he talk to my right hon. Friend the Secretary of State for Trade about the EEC Commission's decision to blow a hole in the Multi-Fibre Arrangement by allowing in additional Portuguese textile goods? Will he give the House an assurance that the Government will stand firm on the issue and maintain the protection for the industry that was announced before Christmas?

The Prime Minister: The Government have taken a firm stand on the Multi-Fibre Arrangement. I am not aware of the point to which my hon. Friend refers but I shall draw it to the attention of my right hon. Friend the Secretary of State for Trade. However, Portugal is in a difficult situation and we should consider seriously any proposals that may come from that country on a number of matters. It has recently emerged from dictatorship, and I should not like to see it thrust back into that position again.

Several Hon. Members: rose—

Mr. Speaker: Order. I shall take points of order later.

EARLY-DAY MOTIONS

Mr. Speaker: Before I call the Prime Minister to make his statement I shall make a brief statement myself. Hon. Members will have noticed the error in today's Notice Paper, as a result of which the names of 23 hon. Members have been added to Early-Day Motion No. 446 in the name of the hon. Member for Putney (Mr. Jenkins) relating to the survival of the monarchy. The names should have been added to Early-Day Motion No. 445 relating to the export trade of live animals for slaughter or for further fattening. I apologise to all hon. Members concerned for the embarrassment that they may have suffered. A corrigendum will be published tomorrow.

Later—

Mr. Burden: I am most grateful to you, Mr. Speaker, for having put the matter right about the motions on the Order Paper. I was greatly surprised when I saw that the names of many of my hon. Friends who had signed Early-Day Motion No. 445 appeared on the Order Paper as having sponsored the motion standing in the name of the hon. Member for Putney (Mr. Jenkins), not least because I handed in all the names myself and by no stretch of the imagination, by any faulty identikit or anything else, could I be mistaken for the hon. Gentleman. I was surprised. I have no doubt that although the hon. Gentleman was surprised he was gratified when he thought that he had so many adherents from the Opposition Benches. However, my right hon. and hon. Friends were horrified when they saw their names

associated with his on Early-Day Motion No. 446.

Mr. Hugh Jenkins: Further to that point of order, Mr. Speaker. May I accept the hon. Gentleman's apology and say that I still live in hope that enlightenment may yet dawn?

Mr. Speaker: It seems as if humour is satisfied.

QUESTIONS TO THE PRIME MINISTER

Mr. Channon: On a point of order, Mr. Speaker. You may have noticed that I had Question No. Q3 to the Prime Minister. I merely ask you, Mr. Speaker, when you are considering Questions to the Prime Minister, whether it is fair to those who had later questions on the Order Paper that discussion on Question No. Q2, asking the Prime Minister to list his official engagements, which appears time and time again on the Order Paper, should last for no fewer than 18 minutes with the result that even Question No. Q3 was not reached?

Mr. Speaker: First, I understand the hon. Gentleman's frustration because he had Question No. Q3. Secondly, he is not correct in saying that Question No. Q2 took 18 minutes. The Question occupied the House for longer than is usual, but the House itself has shown strongly that it goes for that sort of open Question. Even when we came to the end of supplementary questions on that Question, there were still a number of right hon. and hon. Members standing and waiting to be called.

Several Hon. Members: rose—

Mr. Speaker: Order. I have other points of order that will follow the Prime Minister's statement.

Mr. Tebbit: My point of order, Mr. Speaker, concerns Prime Minister's Questions. I did not raise the point during Prime Minister's Questions, Mr. Speaker, knowing your preference for such points to be left until afterwards. You are rightly severe, Mr. Speaker, on hon. Members who ask supplementary questions that are not related to the Question on the Order Paper. I think that it would be in the interests of the House if you were as severe on Ministers, even Prime Ministers, who choose to read


from their brief previously prepared answers to questions that have not been asked by any hon. Member. If that habit is allowed to continue, we may as well dispense with the questions and merely allow Ministers to read out whatever answers they want for 15 minutes.

Mr. Speaker: At the beginning of Prime Minister's Questions today the hon. Member for Northwich (Mr. Goodlad), who asked the original Question, asked a supplementary question that in no way was linked with Tarporley. It was linked with many other things but not with Tarporley. That was why I felt that I could allow the Prime Minister to link an answer to Tarporley. Of course, Ministers are required—Prime Ministers and upwards—to answer questions, and usually they make an effort.

INDUSTRIAL DEMOCRACY (WHITE PAPER)

The Prime Minister (Mr. James Callaghan): With permission, Mr. Speaker, I wish to make a statement on the White Paper on Industrial Democracy to be presented to Parliament this afternoon. Copies of the White Paper are in the Vote Office.
The Government have now completed wide-ranging consultations on the report of Lord Bullock's Committee of Inquiry. It has not been possible to reach agreement between those principally concerned and the Government accordingly submit their own proposals.
The basis of the White Paper is that employees at every level in companies and nationalised industries like their counterparts in some other advanced industrial countries, should have a real share in the decisions within their enterprise which affect their working lives. The objective is positive partnership rather than defensive coexistence. This shared responsibility should bring improved industrial relations and increase the efficiency of British industry.
The Government's intention is that this objective should be secured, wherever possible, by voluntary agreement between employers and representatives of employees. It is not the purpose to impose a standard pattern of participation on industry by law. Employers and employees will be encouraged to devise

arrangements best suited to their own circumstances.
However, where agreement proves impossible, employees will be able to claim certain statutory rights and the Government will introduce legislation to that end.
The White Paper proposes that employees in companies employing 500 or more people in the United Kingdom should have a statutory right to have all major proposals of the company affecting them discussed with their representatives before decisions are taken. These discussions would include such matters as investment plans, mergers, takeovers, expansion or contraction of establishments and major organisational changes. This right should be vested in a joint representation committee. The committee would be composed of representatives of trade unions who are employees of the company and discussions will take place with this committee.
The Government's consultations show that in some cases arrangements on these lines will be as far as employees will wish to go in taking part in the affairs of the enterprise.
But in many cases there will be a wish to go further and for representatives of employees to be appointed to company boards. If this cannot be achieved by voluntary agreement, the Government propose that employees in companies employing 2,000 or more people in the United Kingdom should be able, if they wish, to claim a statutory right to appoint, as a reasonable first step, up to one-third of the directors on the policy board of a new two-tier board structure. This right would be initiated by a request to the company from the joint representation committee and would be invoked after a ballot of all the company's employees to decide whether they wanted to be represented on the policy board.
Company law would be amended to provide for the option of a two-tier board system where the company prefers. Where there is agreement, the right to board representation can be on the existing unitary boards. The White Paper proposes that there should be a period of three or four years experience from the date of establishment of the joint representation committee before this statutory right comes into operation. The introduction of industrial democracy will be


a developing process and the Government do not exclude parity of representation as an ultimate outcome.
The Government are convinced that trade unionists have an essential role to play in industrial democracy. But the White Paper recognises that the responsibilities to be given to trade unions for the appointment of employee representatives on the boards will need further discussion. The Government will reach a decision on this matter after further consultations.
The Government will continue to encourage the development of industrial democracy at all levels in the nationalised industries. Chairmen of nationalised industries have been asked to consult unions and to put forward proposals by August 1978. When legislation is introduced, it will give employees in nationalised industries the right to representation on boards, where it is desired.
In the public service, accountability of Ministers to Parliament and Parliament to the electorate must not be eroded. Similar considerations apply in local government. But, subject to this principle and the need to safeguard the interests of the community as a whole, the Government want employees and their representatives in the public services to be given all possible opportunities to contribute their views on matters affecting their legitimate interests.
The Bullock Committee proposed the establishment of an industrial democracy commission to provide advice on the implementation of industrial democracy. The Government are disposed to accept this recommendation, but are ready to consult further about it.
The direct involvement in overall company policies will require employee representatives to have a knowledge of business, finance, management and other subjects. Training for board members in these matters will be essential. No doubt much will be undertaken within the organisation itself, but it is also proposed that training should take place in residential or non-residential colleges and other institutions. Public finance will be needed to assist this.
The Government believe that these proposals will enable employees and managements to achieve real co-operation by

sharing responsibility for the future prosperity of the companies in which they work. Both our economy and our democracy can benefit greatly. The Government will continue to consult widely so as to achieve the greatest possible agreement on the legislation that will be laid before the House.

Mrs. Thatcher: First, I thank the Prime Minister for his courtesy in letting me have an advance copy of the White Paper this morning.
Is he aware that the Opposition welcome proposals which will lead to greater involvement by the whole work force and note that these proposals seem to be very different from the Bullock version, and rightly so?
I should like to put four questions to the Prime Minister. First, will all employees, whether trade union members or not, have an equal chance to participate in the processes of consultation? Secondly, will independent unions not affiliated to the TUC be equally treated with those which are? Thirdly, will it be right to assume that any statutory rights to be created will apply equally to the whole work force, or will there be discrimination against those who are not members of unions?
Finally, what provision will be made to cover the special and vital role of those employees in junior and middle management? The Prime Minister will be aware that a number of them have felt demoralised because they are not involved as much as they might be. He will note that in the German scheme they are not bypassed. There is a special place for them. What special provision will be made for junior and middle management in participation?

The Prime Minister: The right hon. Lady is basically concerned with employees who are not members of trade unions. I shall seek to deal with those questions, because this has been a difficult matter. It is our intention and desire that all employees should take part in any ballot to decide whether the scheme for electing directors should take place—in other words, whether the scheme should be initiated. That seems important. It is also important that worker directors and, indeed, the joint representation committees should be drawn from employees of the company.
I come now to the particular points made by the right hon. Lady. First, all employees can be involved in consultation. Whether the joint representation committee will include them will be a matter for discussion, because clearly the statute will not be able to cover that aspect. [HON. MEMBERS: "Why not?"] I shall explain that in detail when the legislation comes along. But there will be nothing to prevent the company from setting up parallel discussions with employees who are not members of trade unions if they are unable to get agreement through the joint representation committees. That seems to be the best way of achieving that result.
It is certainly not intended that unions not affiliated to the Trades Union Congress should be excluded from the joint representation committees.
As regards statutory rights, the system of parallel representation can apply. I think that it will have to be parallel representation. Otherwise, we may never get it going.
Finally, there must be further discussion about junior and middle management. There are a number of issues on which we need to have further discussion, because clearly they have as much concern about the future welfare of the companies in which they work as anyone else. To that extent, we should like to see provision made for them.
In conclusion—it is not in conclusion; I hope that it is the start of a long and important debate that could have a profound effect on the efficiency of British industry—one thing which we must have, of which I have been very conscious, is our own system of industrial organisation through trade unions. It is not like that of the Germans or of other countries. Therefore, although we want to make the trade unions in the companies the prior means of consultation and discussion, we do not want to exclude, and certainly no legislation would exclude, employees outside the trade unions. The legislation would have to be framed accordingly.

Mr. David Steel: I also give a general welcome to the White Paper, which at least advances the discussion on industrial democracy beyond the narrow confines of the Bullock recommendations and involves much greater flexibility.
Is the Prime Minister aware that the Liberal Party's main criticism will centre on the fact that the interests of nonunion members are not sufficiently safeguarded in the proposed composition of the joint representation committees?
I should like to ask a specific question about the nationalised industries. The Post Office is cited in the White Paper. But the phrasing does not make it clear that employee representation in the nationalised industries would be by election and that consumer interests would have a statutory right to representation, as we advocated for the Post Office.

The Prime Minister: Some of the nationalised industries will want to exercise any rights which are secured under the legislation. Others up to the present moment will not. For example, that is true of the electrical industry and of the National Union of Mineworkers. Therefore, these proposals will not require people to take part, but it will give them the statutory right to do so.
This legislation is concerned with the rights of employees, not consumers. That matter will have to be taken into account separately.

Mr. Heffer: Will my right hon. Friend assure the House that these proposals will not necessarily be carried out by a future Labour Government, because they are a pale shadow of the proposals made by the Labour Party and even by the Bullock Committee? Will he clearly indicate that, while the proposals may be a basis for discussion, some Labour Members want a system of genuine industrial democracy in which workers have a real say in their industries on the basis of elected representatives to the highest boards of those industries?

The Prime Minister: I know that is my hon. Friend's view. I hope that a future Labour Government will legislate along these lines, because I want to make progress and not see everybody retreating into his trenches. We can have a long fight over this issue for the next decade, a fight in which the directors will go mad and the trade unionists will say "We are having nothing to do with it." Nothing will happen and we shall remain behind other industrial countries. I understand that I shall not please everybody, and I expect a whole volume of criticism. I am trying not only to carry the debate


forward but to get something on the statute book which can be built on in due course as a result of experience.
There is no one view in the trade union movement or in the Labour movement about this matter. I am saying to the Labour movement, to the trade union movement, to company directors and companies that if we can carry through something like this it will mark a very useful beginning to industrial democracy. I beg my hon. Friend the Member for Liverpool, Walton (Mr. Heffer) not to retreat into his trenches and have nothing to do with it.

Mr. Henderson: Is the Prime Minister aware that there will be some welcome for the increased flexibility in the proposals? But it seems that they are so flexible that one has difficulty in understanding what the Government are recommending. Does he accept that it would be a good start if the nationalised industries adopted some of the proposals fairly quickly and acted, as they should, as pace setters to private industry.

The Prime Minister: I am sure that the hon. Member will have no difficulty in understanding the proposals when he reads the White Paper. He will find them clear. It is certainly true that some issues are unresolved, because further discussion should take place.
I understand that the hon. Member probably did not take in all that I said in my statement. But I made it clear that nationalised industries have been asked to submit proposals by August this year so that we can carry forward with them, as we have already done with the Post Office. I am sure that that will satisfy the hon. Member.

Mr. Urwin: May I give my right hon. Friend the assurance that there will be a widespread welcome from this side of the House and from the trade union movement generally for the long-awaited publication of the White Paper? Does he understand that most of us are in difficulty since we have not had the privilege given to the Leader of the Opposition and to the Leader of the Liberal Party of seeing the document? It appears that there is to be a further extensive period of consultation with all interested bodies involved in the legislation. What time scale does the Prime Minister set on the

legislative processes? When can we expect the Bill to be introduced and when will it become law?

The Prime Minister: I am obliged to my hon. Friend for what he has said. I recognise the difficulty of asking questions when a document has not been read. Perhaps hon. Members would like to read it first. But it is customary for me to afford White Papers to the Leader of the Opposition and to the Leader of the Liberal Party.
My hon. Friend asked about the next steps. I hope that now we have had the explosions on either side about Bullock there will be a period of serious discussion. The Cabinet thought that it was right that the Government should publish their own proposals. We are prepared to look at any suggestions for amendments. But I do not believe that discussion should continue indefinitely. We should get on with it. As far as I am concerned the period of discussion could last for some months. I should like to see legislation in the next Session of Parliament if it is possible to draft it.

Mr. Baker: Does the Prime Minister accept that many people on both sides of the House and both sides of industry who want to see a move towards codetermination will probably look upon this proposal for joint representation committees as the most effective vehicle for co-operation? The Prime Minister said that the joint representation committees would be composed of representatives of trade unions who were employees of the company. Can the Prime Minister confirm that employees who are not members of trade unions—since trade union members might be in a minority in a company—will not be excluded from serving on the joint representation committees?

The Prime Minister: I cannot give an utterly clear answer to that. It is a difficult matter, as hon. Members will discover when they become involved in negotiations for legislation. Our view is that where a joint representation committee is ready to accept homogeneous groups of non-organised workers they can, by agreement, become members of the joint representation committee which will be made up of trade union nominees. If that were not agreed—and I can think of companies in which it would not be agreed—it would be wrong to try to force this upon them.
That would lead to no advance. The best thing would be for the company to consider whether it should set up parallel machinery for those who are not members of trade unions if they and the nonmembers of trade unions wish to do so. In other words, we are trying to provide an opportunity for the consultation to cover all the employees, but it will not necessarily do so in one place if there are a large number of non-unionists in a particular company.
Most of the large companies are heavily unionised. They are covered to a greater extent than smaller companies. Although this is a problem that might be discussed in the abstract there will be some practical difficulty. I believe that in the large majority of cases the problem will be settled by agreement. That is my hope.

Mr. John Evans: Does my right hon. Friend accept that industrial democracy can mean many different things to many different people? Does he accept that some of us are becoming a little disturbed at the emphasis of non-unionists by the Opposition? Does he accept that the pressure for industrial democracy came from trade unions not from non-unionists? Will he explain to the Opposition that if we were to consult non-unionists we should have to consult every single one of them because they do not have a collective body to represent them? Does my right hon. Friend accept that legislation can be introduced only through the trade union movement?

The Prime Minister: I accept that view. I have come to that view after a long study of the problem. I accept everything that my hon. Friend says. The best way forward is through the organised trade union movement. But we must take account of the Opposition's main concern, which is with non-trade unionists. We must try to take that into account and not rule out discussion on that subject. But I suggest to the Opposition that they should be concerned basically about how we get the system going among the great body of trade unions and their members. I am glad to know that that is agreed.

Mr. Maurice Macmillan: I fully accept what the Prime Minister says about the need to get the trade unions involved. I

appreciate that there might be difficulties. May we have an assurance that in firms employing 500 people or more where the members of the committee are to be appointed by unions and where the committees are already operated within a pattern that has been agreed with both non-union and union members, the arrangements will not be disturbed simply to accommodate the particular form of industrial democracy that is set out in the White Paper? Does he agree that it would be wrong to disrupt forms of industrial democracy which have been operating for some years?

The Prime Minister: I can give that assurance. Many companies and unions are already moving along this line. I hope that the legislation will be drafted in such a way as not to interfere with any satisfactory arrangements which are already in operation and which are accepted by the company and the unions. To that extent the legislation will form an umbrella over what they are doing. They will have to satisfy certain criteria in the legislation. Provided they do that, it is our strong hope that the legislation will encourage both companies and unions to adopt by agreement their own methods for securing these ends.

Mr. Brooke: Does the Prime Minister recognise that many people will be greatly relieved that the Government are not seeking to impose immediate inflexible regulations on companies? Will he encourage the greatest possible experimentation in the future so that we have institutions which suit us in Britain rather than those that operate in other lands which have a different history from ours.

The Prime Minister: The answer to the last part of the hon. Member's question is "Yes". The British trade union movement is different from that in a number of other countries, such as Sweden and the Federal Republic of Germany, where this type of system has been in operation for a long time. Indeed, that has caused part of our difficulty and has been one of the reasons for the length of time that we have taken.
We shall not impose inflexible regulations, but there will be certain statutory obligations that must be fulfilled if the


two sides cannot come to an agreement. That will be the basis of it. The essence of the proposal is agreement, but we shall not get ourselves into a position where companies can say "We are doing nothing and that is the end of it". If that were to be the line, the trade unions would be able to invoke the procedures that could, in the end, go to ACAS, an industrial democracy commission or whatever form of organisation we thought right. Employers should not think that, by refusing to do anything, they can escape certain obligations. They will be laid down clearly in the statute.

Mr. Radice: Will my right hon. Friend agree that far from being inflexible and doctrinaire, the White Paper takes into account the legitimate interests of both workers and management and should therefore be warmly welcomed on both sides of industry? Would he also agree that the White Paper offers us an opportunity, which we should be foolish to throw away, of creating a new basis of industrial consent which would be of great value to this country, both economically and socially?

The Prime Minister: I agree with my hon. Friend. That is what has inspired our approach to this matter. For all the imprecations hurled at the Bullock Report, it made people wake up and think about this matter. They discovered that it was not possible for them to agree about the proposals. I am grateful to Lord Bullock and his committee because out of its report we have been able to synthesise a new approach which I believe will commend itself to a great many people—though I recognise that not all trade unions will wish to take advantage of it. They will wish to go their own way. That will be for them to decide because the automatic procedures will have to be initiated by the trade unions.

Mr. Viggers: Is the Prime Minister aware that company directors currently have an obligation to consider the interests of the members of the company and that this means shareholders only? Is he aware that this obligation is completely out of line with current practice and does he agree that legislation should be changed as soon as possible so that company directors also have an obligation to consider their duties to their employees?

The Prime Minister: I am much obliged to the hon. Gentleman for what he has said. This is becoming industrial practice and it means that the Companies Acts, especially the 1948 Act, ate getting out of date. That is why we propose, probably in the industrial democracy legislation itself, to include a reform of the Companies Acts legislation. We might need to have a separate Bill. I am not sure. We shall try to include it in the major legislation if possible.

Mr. Hoyle: I agree that there have been differences in the trade union movement, but can my right hon. Friend say how many trade unions are in favour of the two-tier board, which has been discredited by the German experiment? Is he aware that I hope that he will not take too much notice of the siren voices of the Opposition in relation to sweetheart unions? Will he remind the Leader of the Opposition that there are white-collar unions that these people can join?

The Prime Minister: My hope, as a trade unionist of some 50 years' standing, is that people will join the trade union movement and make it what I believe it has always been—a movement that will contribute to the country as well as taking something out of the companies and employment in which trade unionists are concerned. I have always believed that trade unionism has a lot to offer. It was originally constituted as an idealistic movement, and that is something of which we on this side of the House should always be proud.
The trade union movement has swung from the two-tier system. It was originally in favour of it but is now officially against it. However, I do not regard that as necessarily the last word, because everyone's opinion on this matter has been developing throughout the last few years, and I would not be surprised to find that a number of trade unions preferred the two-tier board system. However, it will be for the company to decide whether it would prefer to have one-third of the directors on a unitary board or to establish a two-tier board with a management board and a supervisory board.

Mr. David Price: Will the employee directors appointed under the second leg of the Prime Minister's proposals share equal legal responsibility with all the


other directors? I think that the Prime Minister recognises that this was one of the weakest points in the majority reports of the Bullock Committee, which suggested that trade union directors should be separate somehow in their responsibilities from the other directors on the board.

The Prime Minister: I see no way out of this problem except that trade union directors should share the same responsibilities, in full measure, with everybody else. It will therefore be for the unions concerned to decide whether they wish to assume this responsibility. If so, they can invoke the legislation that I hope Parliament will pass in due course.

Mr. James Lamond: Will my right hon. Friend bear in mind that for some of us, these modest proposals are only cosmetics on the unacceptable face of capitalism and are no long-term substitute for Socialism?

The Prime Minister: I shall be interested to have a longer discussion with my hon. Friend about this, but as long as the face of capitalism is with us—and I agree with him that it is changing over the years and has certainly changed substantially in my lifetime—we should make sure that people who devote their working lives to a company and whose capital—their working lives and skill—is put into a company, are properly regarded and have a proper share of the decisions when that company takes its own decisions.

Mr. Forman: Will there be a sizeable minimum percentage required in the ballots in companies employing more than 2,000 people before the schemes go ahead?

Mr. Henderson: A 40 per cent. requirement?

Mr. Forman: In regard to the so-called industrial democracy commission, does the Prime Minister accept that this may turn out to be another QUANGO and will merely add unnecessary administrative overheads to the structure?

The Prime Minister: I believe that the Bullock Committee said that this should be a 33⅓ per cent. ballot, but we have put no figure in the White Paper. This is a matter for further discussion and a

subject on which I should be happy to consult those who wish to talk about it.
As regards the commission, we started off with the prospect that perhaps ACAS could do this job so that we could avoid setting up another commission, but ACAS has plenty to do and considerable responsibilities. I am not sure that it would be suitable for this purpose. We shall be ready to have discussions.
Having argued it out among ourselves, we think that it would be better to have a commission. It will have to take considerable responsibilities where there is disagreement on the joint representation committees about how the election or nomination of directors is to take place. It will have a job to do there and may also have responsibilities to undertake in connection with education, which I regard as very important in this connection. We should not dismiss the commission as a QUANGO. It will have a real job to do, wherever the responsibilities go.

Mr. Moonman: I welcome the White Paper, but will my right hon. Friend comment on one important omission relating to the type of structure in multinational companies and groups of companies? I recognise that there are obvious problems in the type of structure that other countries have had to deal with, but surely we should be moving towards some type of solution to this problem before me implement anything of his sort.

The Prime Minister: My hon. Friend has raised an important point that caused us a lot of concern. He will find that the matter is discussed in the White Paper. We have not reached a final conclusion on it, though he will find proposals for dealing with multinational companies. There are obvious difficulties that he can see, but perhaps when he and other hon. Members have read the White Paper, there will be a serious discussion about these matters so that we can reach an agreed solution if possible.

Mr. Channon: In very large companies with 2,000 or more employees, which have, perhaps, many employees here and abroad and several unions involved, how does the Prime Minister envisage that the statutory right to one-third of the number of directors will work? The process of appointing those directors could lead to considerable friction on the new board afterwards.

The Prime Minister: I understand that. Again, I ask the hon. Gentleman to read what we say in the White Paper on this matter. I do not think that we have a final solution to that, and I should be happy to have proposals about it.

Mr. Skinner: Will my right hon. Friend accept that not only are there differing views inside the party on this matter but differing views in parts of the party? Will he accept that this set of proposals probably mirrors the avuncular image of himself and a few more like him inside the Cabinet, though not the views of too many of those inside the Parliamentary Labour Party? Will he acknowledge that as he moves from this rather timid, cautious first base, to the second and third bases, if that is found to be necessary, the best possible example that he could set would be to establish a policy board in this place so that we remove the patronage, and so that Labour Members actually elect their policy board instead of having my right hon. Friend the Prime Minister or someone like him hiring and firing all Ministers?

The Prime Minister: My hon. Friend has put forward his views in his characteristic way, but I say seriously to him—

Mr. Skinner: I am serious.

The Prime Minister: I know. I said that my hon. Friend put his views forward in his characteristic way. He is always serious, if idiosyncratic at times. I think that my hon. Friend will find when he studies this proposal that it is not timid or cautious. I believe that it gets the highest common factor possible, and I believe that it will carry us quite a considerable way forward. That is my genuine view about it. What will follow from it will be determined by experience.
On the second point of my hon. Friend's question concerning the election of people, I can only say to him that I went through, I think, four elections in order to be able to stand at the Dispatch Box this afternoon. That is how we elected a new leader of the Labour Party.

Mr. Rathbone: I welcome any step to improve management-worker relations, but will the Prime Minister accept that some people will be worried that works

councils do not feature in his statement? I have not had a chance to read the White Paper, so I do not know whether works councils feature in it. Will the Prime Minister comment on the matter?

The Prime Minister: The White Paper contains no reference to works councils as such, but the White Paper makes clear that existing arrangements that are satisfactory to the employees and trade unions concerned will not be interfered with by this proposed legislation. Such bodies will be able to adapt to the legislation if they wish to do so. But if there is agreement with the existing works councils or any other form of representation that they already have, they may continue with it.

Dr. M. S. Miller: Is my right hon. Friend aware that there will be grave disappointment in some sections of the trade union and Labour movement with these milch cow proposals of Bullock? Is he aware, however, that it is also accepted that this subject raises a very difficult problem? Will he give an assurance that these proposals are merely the first tentative steps towards what we in the Labour movement are aiming at, which is for companies to be controlled to a very great extent by the people whose lives are involved in them? If he will give that assurance he will assuage the fears of many people.

The Prime Minister: These are obvious first steps because we are feeling our way in this matter. In Germany, for example, it took 25 years before the present state of industrial relations and industrial democracy was achieved. I do not know that it will take us 25 years, but I suggest to my hon. Friend that experience of doing something often changes one's view about how it should be done. I believe that when they start to practise industrial democracy in this form people may change their attitudes about what should be either their ultimate objective or the way in which they should achieve it.
But the Government would not rule out, any more than it has been ruled out in Germany, the ultimate objective of parity in these boards. I do not wish to start an argument about that, because if I do I shall frighten away a great many company directors who will look only at the question of parity and will not see that this process must move step by step. It


must proceed first to the joint representation committees and then to one-third representation on the board of directors, which is looking five to six years ahead. After that it will be for the House of Commons and the Government of that time to say what they think the next steps should be. This is an evolutionary process, as it has happened in other countries.

Mr. Bulmer: Does the Prime Minister accept that the proposition that the corporate plan should be jointly discussed will give rise to difficult problems of confidentiality and flexibility, not least in the multinationals? How does the Prime Minister propose to tackle that? Does he not feel that there is a danger that the companies may become lumbered with a corporate plan in much the same way as his Government are with their manifesto?

The Prime Minister: I am glad to say that we are not lumbered with that. It has been carried through. On the hon. Gentleman's serious point, of course, corporate plans are confidential, but I hope that he was not attributing to employees of the company who are trade unionists any less responsibility than is felt by the directors of the company. If he was, I disagree with him. I think that the hon. Gentleman, with his experience of trade and industry, will have found, as I have certainly found with my slight experience of it as I go round the country talking to workers and trade unions in particular companies, that they are as concerned about the welfare and the future of their companies, and therefore about the confidentiality of information about their companies, as is any manager or director. If we approach the matter on that basis, I believe that, by agreement, employees in the company who are serving on the joint representation committees will be able to secure in complete confidence information that is available to the directors.

Mr. Norman Atkinson: Contrary to the view that my right hon. Friend has just expressed—that the proposals could possibly be an evolutionary process—will he acknowledge that while there are in the White Paper many progressive proposals which will undoubtedly contribute towards improved participatory methods in industry, there will be widespread disappointment throughout the Labour movement that in the disagreement

shown in the Cabinet, Ministers have turned away from the first principle of establishing a boardroom parity between capital and labour? Does he agree that this surely should be the uppermost policy in the Labour movement? Does my right hon. Friend recognise that it is towards the attainment of that principle that all of us who sit on the Labour side of the House are looking?

The Prime Minister: I am grateful to my hon. Friend for saying that there are progressive proposals in the White Paper. That is true. I do not know whether there will be widespread disappointment in the Labour movement about the failure to achieve boardroom parity. I wonder, for example, whether the union to which my hon. Friend belongs will share that disappointment. I have not heard that his union has been in the forefront of this matter. I say that not to cast stones at him, but to show that there is a real division of opinion on these matters. We are trying to make progress, and I believe that we shall do so.

Several Hon. Members: rose—

Mr. Speaker: Order. We have been discussing this matter for more than three quarters of an hour. I shall call two more hon. Members from each side, and then we must move on.

Sir Brandon Rhys Williams: I congratulate the Prime Minister on breaking away from the attachment of the majority of the Bullock Committee to the traditional unitary board and making possible a move to two-tier boards. Does the Prime Minister agree that, in preparation for such a big reform, there are aspects of company law which require immediate attention, particularly in regard to the rights and responsibilities of executive and non-executive directors?

The Prime Minister: Yes, I think that in a two-tier board there would have to be a clear delineation of responsibilities between the supervisory board and the executive and management board if that system were adopted. That matter will need considerable discussion. I hope that those concerned in the Opposition, the CBI and elsewhere will now be willing to discuss these matters instead of just throwing them on one side, that they will recognise the determination that has gone


into this matter and will come forward with proposals that will best make this scheme work. I shall be happy, with my right hon. Friends, to consider what is said.

Mr. Dalyell: I hark back to the proposals that have been requested from the chairmen of the nationalised industries by August this year. Is my right hon. Friend aware that in the Scottish gas industry there are deep-rooted problems of management and unions? Is the idea that these proposals should be put forward, for example, from the gas industry, to deal with deep-seated problems? Or is what my right hon. Friend said a general statement of principle as to what should be done? What is being asked for by August 1978?

The Prime Minister: Each individual nationalised industry has been asked to put forward its proposals and to state the attitude that would be taken both by the board and by the trade unions concerned. I am not, I fear, directly involved in the Scottish gas industry, and therefore I cannot answer my hon. Friend's particular question. But it would be for the gas industry to put forward its own proposals. If there are difficulties, they will have to be ironed out, if that can be done. But let no one underestimate the difficulties of getting joint representation committees working, of getting agreement on who should serve on them, or, as a next step, of getting agreement on how worker directors should be elected. All this will be very difficult, but I think that it is worth while trying, and if an effort is made to do it I shall be very happy.

Mr. Haselhurst: By what test has the Prime Minister satisfied himself that the proposals put forward in the White Paper are actively sought by workers on the shop floors of industry? Would it not have been better to keep the options wider?

The Prime Minister: I have no test to determine whether these proposals are genuinely being sought by workers in companies of the sort I have described. However, the hon. Gentleman's veiled criticism is met by the fact that it will be for the trade union representatives in a company to decide whether to invoke the procedures. If there is no interest, as he suggests, presumably they will not,

therefore, invoke the procedures. If there is interest, they will invoke the procedures.

Mr. Newens: Does my right hon. Friend recognise that at present, and for many years past, the co-operative form of enterprise has usually permitted employees to be elected to the boards of societies? I entirely endorse any steps that are taken towards the democratisation of industry in general, but may I ask whether my right hon. Friend will ensure that the co-operative model is studied carefully in order that the intrinsic merits that it undoubtedly has are not lost in any changes that are introduced?

The Prime Minister: I know my hon. Friend's keen concern about the co-operative movement. I hope that the Co-operative Development Agency—I am very grateful to the House for agreeing to put through that Bill—will indeed have a part to play in all these matters of the development of democracy in industry. It is a counterpart to the democracy that we have in this country, and I should like to see that carried forward. Basically, however, I think that the system in British industry is almost certain to be built on the trade union rock, which is so strong in most of our large companies and on the boards of directors as they exist.

Mr. Michael Morris: On a point of order, Mr. Speaker. May we seek your guidance? In answer to a number of hon. Members, the Prime Minister has referred them to the White Paper. I think that hon. Members would feel that they could ask more poignant questions if they had the opportunity of reading the White Paper before questioning the Prime Minister. Could consideration be given to that matter in the future?

Mr. Speaker: The hon. Member will understand that although he has raised a point of order, it was not addressed to me.

Mr. Fairbairn: On a point of order, Mr. Speaker. I would not wish to make any criticism of the Chair, but in your selection of those who have been called to ask the Prime Minister questions, two Labour Members who represent Scottish seats were selected, and one Scottish National Party Member. I was the only Scottish Conservative Member who stood consistently, and none was called. I feel that this is unfortunate. This matter


applies to us and is of as much interest to us as it is to the rest of the country.

Mr. Speaker: I understand the hon. and learned Member's feeling. He has drawn attention to one of the difficulties that I am constantly under in the Chair. It is not that I did not want to call a Scottish Conservative.

Dr. M. S. Miller: I did not know that the hon. and learned Member was a Scot.

Mr. Speaker: Order. The hon. and learned Member has made a fair point. I have tried to get a balance when calling hon. Members to speak. There are eight parties in the House these days. It is difficult. But I am sorry that there was not a Scottish Conservative Member called.

KING'S COLLEGE HOSPITAL, LONDON

Mr. Christopher Price: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
the serious impairment to National Health Service standards, including the risk to life, at King's College Hospital in South London".
I do not know how many hon. Members were able to see yesterday the programme "World in Action", but for those who did, it revealed a situation of crisis which I believe is important, specific and urgent. Among incidents revealed were the endangering of life by inadequately trained agency nurses, the inability to provide constant nursing care for seriously ill patients, serious under-staffing of all wards, and individuals dying while waiting for operations.
Though I would have a number of serious reservations about the balance of the programme, and I would rebut the charge of any general breakdown in the National Health Service, a situation has been revealed in which very serious dangers to health and, in some circumstances, life exist. This shows that the circumstances are specific and urgent.
But the matter is important on a wider level, because it reveals a crisis on two particular levels. The first is that cuts in public expenditure which have affected the

NHS over past years are now coming home to roost, and the associated quite proper efforts, through the Resource Allocation Working Party, to redistribute what are totally inadequate resources to less advantaged areas are at present crippling parts of the NHS in the Lambeth, Southwark and Lewisham area, and probably in many other parts of the country, too. The Lambeth, Southwark and Lewisham Area Health Authority is currently, on top of this very serious situation being revealed, being expected this year to reduce its expenditure by £2 million.
This matter is important for one other reason. That is that it reveals the complete inability of the management structure of the NHS—which was reorganised in a bureaucratic and inefficient manner, not by the Labour Party but by the previous Conservative Administration—to secure the proper distribution of NHS facilities and to prevent the sort of appalling frictions between the medical and nursing professions which were revealed in the programme of yesterday.
I submit that any situation which reveals a lack of space in intensive care units, which can admit of incidents in which ill-trained nurses can accidentally feed drugs into a patient's artery when they should have gone into a vein, in which a consultant can talk of 24 avoidable deaths in a year, is just one of those urgent and specific matters which justify an emergency debate. I submit that a case has been made for that.

Mr. Speaker: The hon. Member for Lewisham, West (Mr. Price) gave me notice before 12 o'clock today that he would seek leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that he believes should have urgent consideration, namely,
the serious impairment to National Health Service standards, including the risk to life at King's College Hospital in South London".
I listened carefully to what the hon. Gentleman said. As the House knows, it is not for me to decide whether this matter is to be debated but merely whether it is to be debated tonight or tomorrow. That is all the discretion that lies in my hands. I have to rule that I cannot submit the hon. Member's application to the House.

ROYAL VICTORIA HOSPITAL, BELFAST

Mr. Bradford: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
the recent deterioration in the already inadequate security at the Royal Victoria Hospital, Belfast, due to the presence of Provisional IRA sympathisers on the security staff of that hospital".
One notes the disgusting spectacle of a security supervisor, John Devine, assisting three armed terrorists to escape from the hospital by returning their car keys, which he had in his possession long enough to convey to the security forces, and by misinforming the Royal Ulster Constabulary of their escape route.
One also notes that Devine, whose son is in prison for terrorist murder, has been joined in attendance at Provisional IRA funerals, by Peter Macken, Thomas Mallon, Liam McMenemy, Liam Dwyer, James McCann, and his brother, Charles Devine, all of whom are on the security staff of the Royal Victoria Hospital.
This House should have time to probe these incidents, especially the incidents that involve Devine, who has been photographed very recently during a Republican demonstration, which clashed with the RUC in Belfast.
To those incidents I add the very recent and very frightening experience of a leading nursing officer who, after reporting a misdemeanour by a security man, was told by members of the security staff at the hospital that he would be permanently "fixed". There are those who are willing to substantiate the assertions to any Member of the Cabinet, even to the Prime Minister.
In conclusion, I believe that this House should help the medical and nursing staff, who are committed to saving life and easing pain, by debating what steps can be immediately taken to deal with those whose psychopathological pastime is to take life and to intensify pain, and to deal with those who assist them in any way, including those members of the security staff that I have now named.
This House should immediately take the opportunity of coming to some

arrangement whereby the security at the Royal Victoria Hospital, Belfast, is placed in the hands of a national organisation, such as Securicor, and certainly to remove these gangsters from the position of authority and influence that they hold.

Mr. Speaker: The hon. Member gave me notice before 12 o'clock today that he would seek to move the Adjournment of the House under Standing Order No. 9 for the purpose of discussing a specific and important matter that he thinks should have urgent consideration, namely,
the recent deterioration in the already inadequate security at the Royal Victoria Hospital, Belfast, due to the presence of Provisional IRA sympathisers on the security staff of that hospital".
I have listened with concern to the hon. Gentleman. As the House knows, I am not required to give my reasons in replying to an application for an Adjournment debate. I cannot grant the hon. Gentleman's submission and I would say to him, as I would say to the hon. Member for Lewisham, West (Mr. Price), who sought a debate earlier, that there are other means by which he can pursue this matter within the House.

BILL PRESENTED

MERCHANT SHIPPING (PREVENTION OF POLLUTION)

Mr. Neville Trotter presented a Bill to enable effect to be given by Order in Council to the International Convention for the Prevention of Pollution from Ships 1973 and to any modifications of the Convention and any convention superseding the Convention; and to the Protocol relating to Intervention on the High Seas in the cases of Marine Pollution by Substances other than Oil; And the same was read the First time; and ordered to be read a Second time upon Friday, 14th July and to be printed. [Bill 136.]

STATUTORY INSTRUMENTS, &c.

Ordered,
That the draft Consular Relations (Privileges and Immunities) (Polish People's Republic) Order 1978 be referred to a Standing Committee on Statutory Instruments, &amp;c.—[Mr. Frank R. White.]

EARLY-DAY MOTION NO. 444

Mr. William Hamilton: On a point of order, Mr. Speaker. I should like to raise a question which is important to other hon. Members. You will know that, last Friday, I tabled an Early-Day Motion on the Civil List. Having recalled what "Erskine May" said about the characteristics of parliamentary language being good temper and moderation, I carefully framed my motion to fit in with that description. However, when I took the motion into the Table Office, a Clerk demurred and suggested that it might be construed in another way by yourself and those who perform those functions.
There the matter was left until yesterday, when I received the revised version of my Early-Day Motion, which, in terms used in this House, consisted of a whole series of wrecking amendments. The final version which was put to me bore little relation to the version which I orginally put forward, including the title. The title was completely unacceptable and was altered in toto.
I shall get into deep trouble with my very large number of supporters in the country when they see the motion, which purports to be in my name, but which in fact is not my wording.

Mr. Fairbairn: Then the hon. Gentleman should not have put it down.

Mr. Hamilton: I was faced with that situation. The language that I wanted to use was parliamentary language; there was not an expression there which was deeemed by "Erskine May" to be un-parliamentary. Nevertheless, they were deleted. This should concern all hon. Members.
One of the great attributes which we sometimes claim for this House is freedom of speech within certain bounds. I thought my motion was couched within those confines, and I object very much. I feel a great sense of frustration that I cannot express the very strongly held views I have on these matters in the way I want to express them. I understand, of course, that there are limits to what one can say, but I thought that I was well within those limits in my original version.
If it is not possible to put motions down on the Paper, then I feel almost tempted, obliged to publish the original

version and let people outside judge what exactly this kind of censorship means in this House. I hope this will be dealt with in some seriousness. I regard it myself with some seriousness and I hope you, Mr. Speaker, will make some judgment on it.

Mr. Mawby: Further to that point of order, Mr. Speaker. I looked at the motion put forward by the hon. Member for Fife, Central (Mr. Hamilton) this morning and I felt that it was outrageous.

Mr. Hamilton: It was very modest.

Mr. Mawby: I felt it was something to which I should put down an amendment. I just wanted to give you that information, Mr. Speaker.

Mr. Speaker: I am much obliged. The hon. Member for Fife, Central (Mr. Hamilton) and the House will know that I take very seriously the responsibilities that the House has put into my hands concerning motions on the Order Paper. When I considered the original draft of the hon. Member's motion, I took the view that it contained certain expressions which were irregular or unbecoming, and therefore, as "Erskine May" points out on page 373, "disorderly".
It is a well-established practice that the Speaker exercises his discretion in disallowing such expressions. It would not be right for me or for the hon. Member or anyone else to say what they were.
I should add that I am surprised that the hon. Member has raised the matter because I thought that the hon. Gentlehan had accepted the ruling. Obviously I was not under the impression that a motion had gone on the Order Paper without his agreement. If that is so I shall gladly look into the matter, but his amended motion, which I understood had been sent to him and accepted by him, has appeared on the Order Paper.

Mr. Hamilton: Further to the point of order, Mr. Speaker. That is true to some extent, but when one is faced with an amended version, one either accepts it or one does not get anything down at all. There was a Biblical expression that was ruled out of order. I shall not repeat it, but I see nothing unparliamentary in using a Biblical expression in an Early-Day Motion. It is true that I went into the Table Office with the amended version


which was put to me, and that is what the hon. Member for Totnes (Mr. Mawby) has described as "outrageous". Yet it is the version proposed by the Officials of the House. The original was much stronger meat. I object to my beer being watered.

Mr. Speaker: Let me make one thing clear. The motion is not proposed by any Officials in this House. What they did was to try to help the hon. Gentleman to remove the parts which were considered to be disorderly.

SERVICES WIDOWS (PENSIONS)

4.38 p.m.

Mr. Peter Viggers: I beg to move,
That leave be given to bring in a Bill to make further provision for service pensions and in particular to provide pensions for widows of non-commissioned servicemen who retired before 1st September 1950.
People may think that "Upstairs, Downstairs" was a television series which portrayed an age that is past. But "Upstairs, Downstairs" lives on today in the pension arrangements for widows of our Service men. The widow of an officer who retired before 1950 receives a pension. The widow of a man who served as a non-commissioned officer or in the ranks does not. This Bill would correct that indefensible unfairness.
Parliament represents the employer of all those in the Armed Forces and, broadly speaking, it has done well by those now serving and recently retired. Inflation-proofed pensions have enabled many Service men and their families to retire in dignity and some comfort—although their pensions still compare unfavourably with those of most other countries.
However, the widows of non-commissioned ranks who retired before 1950—the pre-1950 widows—receive what they have always received from the Ministry of Defence—nothing. Widows of officers have received pensions for many years. It was not until 1952 that a pension entitlement was introduced for widows of ranks below WOI and a cut-off date was set at 1st September 1950. The widows of men retiring after that date were given a pension of one-third of that received by their husbands, which was increased to one-half in 1973. But the pre-1950 widows were left out. The latest estimate—made in 1972—of the number of widows involved is about 30,000. The cost of granting pensions would be about £4 million a year, also calculated in 1972.
Pension schemes need to have cut-off dates. Therefore, what is special about the pre-1950 widows? Their husbands, to be eligibile for pension themselves, all served a minimum of 22 years in the Armed Forces in conditions which would now be intolerable. Every man served through one world war, and many


through two. They endured long periods of separation from their families, with pay so low that personal saving was difficult, if not impossible. Moreover, inflation has made a mockery of any personal savings they had. The Service man's entire recompense for his period of service is therefore tied up in his pension, and in the case of a Service man who retired before 1950 this dies with him and no benefit passes to his widow.
The continuation of this position derives from Government policy over a number of years. I quote from a letter written by the Prime Minister on 26th May 1976:
The principle on which public service pensions are based is that any improvements apply to those leaving the service after the date of introduction, but not retrospectively to those who retired earlier.
But this principle is not sacrosanct. Any good pension scheme should give the trustees discretion to make special payments.
Let me give an example. When my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) was responsible for social services, he introduced pensions for the over-80s, not because such pensions were actuarially correct but simply because the over-80s had been left out and this was not fair.
What kind of people are we dealing with? I have a letter from a constituent, a letter which I happened to take from a pile of letters, two inchs deep, from hundreds of people. It is typical of what is contained in that correspondence. This gentleman, a constituent, served in the Services for 22 years, and he points out that he survived the bombs and torpedoes that sank HMS "Prince of Wales". He says:
My wife is 70 and I am 77 years of age. My main concern is now my wife. I hate to think what will happen to her if she is the survivor. She will have to revert to the lowest of incomes. … My wife is the same as the other widows. Her pride would not let her apply for social security when she is really entitled to part of my pension.
These Service men and their wives think that there is an entitlement. I feel that

they have been left out of the provision, and that is not fair.
The widows remain as a symbol of a bygone age of service and unquestioning loyalty. They see the world changing around them and benefits of all kinds being enjoyed by people who are less deserving. Is this fair? Is it not proper for us to reconsider the position of those who have been left out of pension improvements?
There is money available when political necessity demands. Only yesterday the Secretary of State for Defence announced that Service men retiring now will enjoy the benefit of increased pensions as if they had retired on the increased 1980 pay scales. Yet the pre-1950 widows remain left out.
The Bill which I now present has the support of representatives of all parties, and indeed every person who studies the facts—indeed, every person I have ever spoken to on the subject—gives sympathetic support to the cause of the pre-1950 widows. My Bill will convert that sympathy into action.
I ask leave to introduce my Bill, and I plead with the Government to take up its provisions.

Question put and agreed to.

Bill ordered to be brought in by Mr. Peter Viggers, Mr. Alan Lee Williams, Mr. Philip Goodhart, Mr. Stanley Newens, Rear-Admiral Morgan-Giles, Mr. Richard Crawshaw, Mr. Julian Critchley, Mr. Emlyn Hooson, Mr. Iain MacCormick, Rev. Ian Paisley, Mr. Dafydd Wigley, and Mr. John Ovenden.

SERVICES WIDOWS (PENSIONS)

Mr. Peter Viggers accordingly presented a Bill to make further provision for service pensions and in particular to provide pensions for widows of noncommissioned servicemen who retired before 1st September 1950; And the same was read the First time; and ordered to be read a Second time upon Friday 14th July and to be printed. [Bill 135.]

Orders of the Day — HOME PURCHASE ASSISTANCE AND HOUSING CORPORATION GUARANTEE

As amended (in the Standing Committee), considered.

4.45 p.m.

Mr. Tony Durant: On a point of order, Mr. Deputy Speaker. I wish to mention New Clause No. I—Interpretation—which is in my name and that of the hon. Member for Mitcham and Morden (Mr. Douglas-Mann) but which has not been selected. I am in no way challenging the Chair's selection, except to say that the clause affects some 30 per cent. of new home purchasers because a mobile home often provides the first opportunity for a person to buy his own home. I feel that the definition of "a home" should include mobile homes.
I appreciate that in Committee it was ruled that mobile homes were not classified as "homes", but I query this and wonder whether the matter has been properly examined. Therefore, I wish to place on record my disquiet that the clause, which I tabled in an effort to assist in defining "home" and to use the relevant provisions from the mobile homes legislation, will help the Bill. That is why I am concerned to see that the new clause was not selected. I am in no way challenging the Chair's ruling but I wish to place on record the fact that the ruling caused me some disquiet.

Mr. Deputy Speaker (Mr. Oscar Murton): The hon. Member should have his attention drawn to Standing Order No. 33 (1), which states that
In respect of any motion or any bill under consideration on report or any Lords amendment to a bill, Mr. Speaker shall have power to select the amendments, new clauses or new schedules to be proposed thereto.
I would add that this direction by Mr. Speaker is absolute, and is not open to query. It is, as the hon. Gentleman knows, not a practice of Mr. Speaker to give reasons.

New Clause No. 2

DURATION OF ASSISTANCE

Assistance under this Act shall subsist for the entire period for which the assistance is given notwithstanding the fact that the purchaser sells the house property and applies the proceeds of sale to the acquisition of another property which he makes his only place of residence.'.—[Mr. Rossi.]

Brought up, and read the First time.

Mr. Hugh Rossi: I beg to move, That the clause be read a Second time.
I am sorry to see the Under-Secretary of State for the Environment appearing at the Dispatch Box wearing a sling. I hope that he is not suffering too much discomfort and I shall do my best not to add to it.
The Bill as presented enables a loan of £600 to be made interest-free for five years to first-time buyers who, for a period of two years preceding, have themselves been able to save a sum of £600 of their own. Once they have bought their first house and borrowed that £600, that loan will remain for the life of the mortgage which has been taken out with the assistance of this loan, enabling them to undertake the purchase. It is the first five years that is interest free. For the remainder of he mortgage they will pay interest on the £600.
However, one finds that the Green Paper on housing produced by the Government, in Technical Volume II, shows that 51 per cent. of first-time buyers sell up their house and move within five years of purchase. In other words, there is a fairly rapid turnover of owner-occupiers. That being the case, we feel that it would be undesirable to create a situation in which people might find it difficult to change their homes. They do not do so arbitrarily; they do so because their personal circumstances are such that they have to do so. An increase in the size of family may require them to buy a larger house, or a change of job may require them to move from one part of the country to another.
I hope that it is part of public policy to make it easy to move around freely. Unhappily, as the Bill is drawn, if the house is sold within the five-year period,


the £600 has to be repaid and, moreover, cannot be claimed again on the purchase of the second house because the borrower is no longer a first-time buyer and no longer within the terms of reference of the Bill.
The object of the new clause is to try to overcome that difficulty. It would enable assistance under the Bill—the loan of £600—to subsist notwithstanding that the purchaser sells the house and applies the proceeds of the sale to the acquisition of another property which he makes his only place of residence.
Of course we have had to include that last qualification in the new clause because we agree that it would not be right that help of this kind should be extended to the purchase, for example, of second homes. That is not the object of a scheme of this kind. Nevertheless, we can contemplate a situation in which a young couple, having bought a home with the help of the additional £600 loaned to them interest free, later want to move because they need a larger house or for the other reason I gave, but find that the other house, because of inflation, is marginally more expensive than the one they are leaving. Because, under the Bill as drafted, they will no longer have the benefit of this £600 loan, since it has to be repaid and is not renewable for a second purchase, they may find themselves trapped, as it were, in their first home, unable to buy the larger home that they may need, or unable to accept a new job opportunity.
I see no objection to the principle underlying the new clause. It would be of considerable benefit. I cannot conceive, either, with the qualification that we have written in, that such a proposition could be subject to any kind of abuse. I understand that the only objection that exists is one of administration, because, in the way that building societies operate, they have forgone the use of the clerks who of old could do simple arithmetic in their heads, and today they put everything on a computer. The more we mechanise and progress, the more difficult and complicated life becomes. Therefore, these computers are to be programmed in such a way that, at the end of the five-year period, what is left of the £600 after allocation of repayments is shown up as the final amount that then becomes subject to interest.
If one were to say, as we suggest, that at any point of time there could be a break and a renewal of the loan, it seems that the programming would have to be done for the whole of 1,825 separate points in time—that is, the number of days within the five years. That kind of programming would apparently cause a great deal of administrative difficulty for the building societies, but it would not be insuperable difficulty.
There is another way to approach the problem. We can say that during the five-year period none of the capital repayments should be attributable to the £600 loan and that those repayments should be attributable to the other borrowing of the purchaser of the property. If that approach were suggested, I do not think that it would be difficult to adopt because, in the first five years of a mortgage, a very small proportion of the monthly repayments is attributable to capital, the bulk being comprised of interest payments. Such capital repayments as were made within the five years would relate not to the £600 but to the remainder of the borrowing. In that case, one could overcome the administrative difficulty that appears to be the only obstacle in the way of the new clause.
I hope that the Minister will accept this proposal in the spirit that it is made and recognise that what we are trying to do is to make the scheme more effective and of greater help to young people who may find themselves otherwise trapped in their house of first choice because if, they sell and re-buy, they will be £600 short on their borrowing.

Mr. David Atkinson: The new clause gives me an opportunity to draw the attention of the House to the consequence that the Bill will have for first-time buyers in my constituency, including those whose jobs necessitate their moving home. I know that my right hon. Friend the Member for Bournemouth, West (Sir J. Eden) wishes to be associated with my remarks.
The Bill refers to the loans available being based on a purchase price with a price limit prescribed by the Secretary of State, and states that different limits may be prescribed for properties in different parts of the country. Under that proposal, Bournemouth is to be categorised as in the South-West Region, and I understand that the price limit to be applied to


that region is about £11,200. Yet the Minister is surely aware that because of the nature of Bournemouth as an urban area, as opposed to the otherwise rural nature of the region, and as an attractive area not only in which to work but to retire to, and as a resort which attracts and encourages an above-average job mobility amongst young people because of the seasonal nature of its trade, the demand for homes there will always be at a premium, and thus so will the price be.
The average price of a house for the first-time buyer in Bournemouth will therefore be considerably higher than the average price of a house elsewhere in the South-West Region. If one is to be entirely fair to Bournemouth, the price must be regarded as in the same sort of bracket as the average price in a place like Southampton, 15 miles away, or, indeed, equated even with London. So instead of a price limit of £11,200, one nearer £14,500 or £15,000 would be more appropriate. It is only because of the local government reorganisation that took Bournemouth out of Hampshire and into Dorset, and into the South-West Region from the South-East Region, in which the price limit for property will be considerably higher, that the first-time buyers in my constituency will be penalised as a result of this provision.
I hope, therefore, that the Minister will take the opportunity to explain to the first-time buyers of Bournemouth, and in particular to those whose jobs will take them there, the justification for placing the borough in the South-West Region, which will have the result of giving them a raw deal in providing them with assistance under the terms of the Bill.
Young people seeking council houses in Bournemouth are already seeing their hopes dashed as a result of the Housing (Homeless Persons) Act because other people are moving into the area and are being shown preference for accommodation as opposed to those who have been living in the area for a number of years.

Mr. Stephen Ross: Until the last minute or so I had great support for the hon. Gentleman. The Isle of Wight is in the South-East Region, and if Bournemouth goes to the South-West

that is nonsense, because prices in Bournemouth are substantially higher than in my constituency. But it was not the present Government who reorganised the local government of Dorset and Bournemouth, the hon. Gentleman should make his representations elsewhere.
Will the hon. Gentleman give facts and figures for those who he claims have moved into Bournemouth since the Housing (Homeless Persons) Act came into force and have got accommodation over the heads of local residents? If he would like to give the figures I would be pleased to have them for Thursday night.

5.0 p.m.

Mr. Atkinson: The hon. Gentleman will be entirely appreciative of the situation to which I refer, because he was a sponsor of the Bill that I mentioned. The consequences of it are of considerable concern to the council in Bournemouth and to the young people who are waiting for their council house and finding that they remain on the waiting list with very little hope, quite simply because they are overtaken by people coming into the area and taking advantage of the seasonal trade in order to satisfy the six months qualifying period.

Mr. Ross: Let us have some facts.

Mr. Atkinson: First-time buyers in Bournemouth will be severely affected because of the provision that I mentioned. I urge the Minister to agree that Bournemouth should be recognised as separate from the rest of the South-Western Region in regard to the price limit for house purchase prices.

Mr. Michael Latham: I should like to make a brief intervention, but before doing so I remind the House that I have an interest in this matter, as I am a director of a building company.
It should be said in support of the new clause—which is a very reasonable and important one, in my view—that the gateways for obtaining the relatively limited assistance under the Bill are extremely difficult. This is something that will not happen for at least two years, once the provisions of the Bill begin to take effect. We are talking of something in 1980–81.
Let us remember what a person has to do in order to qualify at all. It is clearly set out in Clause 1(3). First, he has to


have been saving for two years—and two years continuously, at that. Secondly, within the 12 months before the two years he has to have maintained an account of at least £300. Thirdly, by the end of the two years he has to have £600 in an account with a recognised savings institution. If he has done all those things, he is eligible for the £600 loan free of interest and of any obligation to repay the principal for up to five years.
As I said on Second Reading, many people will not bother with that sort of exercise. Although, on the new clause, Mr. Deputy Speaker, it would be out of order for me to talk much about the position of house prices at the moment—perhaps it would be in order to do so at a later stage—we all know that there is some danger, at any time, of house prices outstripping incomes. If that happens, as I said on Second Reading and in Committee, a person going into the scheme would be better advised to put his money together as quickly as possible and to buy a house rather than go for the £600 loan, which at the end of the two-year period might well have been overtaken by the house price increase. He would therefore be even worse off than if he had put his money together as best he could at the beginning of the two-year period.
But let us suppose that those bad conditions do not occur, and that the rise in house prices, as the Government would wish, is in accordance with the rise in the cost of living and the rise in people's incomes, so that it is not detrimental to go into the scheme. Even so, the five-year period will then begin to take effect, and if the house is sold during that time the repayment must be made. I emphasise very strongly—as did my hon. Friend the Member for Hornsey (Mr. Rossi)—that that would have a bad effect on the chain of housing.
I believe that in Committee the Minister said that he expected 40,000 people to be brought into the new home ownership net who would not otherwise have been brought in. I note that the Minister nods his head. There is no doubt at all in my mind that of those 40,000 people a not unsubstantial number will wish to move within the five-year period, so that the benefit will have to be repaid. That will have an adverse effect on the chain of housing.
All of us who take a particular interest in housing policy—in other words, those of us who are here in the Chamber—know very well that the problem—

Mr. Durant: Some of us.

Mr. Latham: No, all of us. My hon. Friend should not be so ungenerous.

Mr. Durant: It would be nice if we were to see some new people taking part in the debate. We always seem to see the same faces.

Mr. Latham: There are other hon. Members who come in periodically, and no doubt we shall see them during the course of the debate.
With regard to the five-year principle and the chain of purchase in particular, many experts have suggested that the 1980s may be a period during which houses will be difficult to sell. It has been suggested that the relationship between population and housing stock will be such that the housing stock may stick, and that in certain areas there will be a surplus. I entirely accept that in many areas there will be no building surplus; nevertheless, anything which adversely affects the chain is to be deplored, because it will have a bad effect on housing policy.
I find it quite impossible to understand why the Minister should resist the new clause. It is drafted in the most moderate terms, it is perfectly sensible and it has a minimal effect. I cannot believe that the administrative problems for building societies would be insuperable. We are talking of only 40,000 people among the 4·8 million who have mortgages. I am sure that any problems can be overcome, given good will and a proper programming of the computer. I hope that the Minister does not have the word "Resist" at the top of his brief, and that he will accept the new clause.

Mr. Durant: I support the new clause because I feel that one of the detrimental effects of the Bill will be to cause more immobility in housing, and I am concerned because we have too little mobility already. It is a deterrent in regard to people taking new jobs and moving around the country, and will only be another nail in the coffin of those who want to move regularly and often. I think that the new clause is reasonable and is one that we should support.
We must face the fact that if we are to have new industries in different parts of the country, people will want to move to those parts of the country in order to take up those new opportunities. But if we continually make it more and more difficult for people to move, the country's economic problems will get steadily worse.
I believe that we should take this opportunity to show that we believe in mobility. I am sorry that my new clause concerning mobile homes was not accepted. I believe that it would encourage people to move towards new areas, to new jobs and to new opportunities, instead of feeling that, having gone into the scheme, however small it is, they are stuck for a minimum of five years. That would be a great pity in relation to what is, after all, a worthwhile small piece of legislation.

The Under-Secretary of State for the Environment (Mr. Ernest Armstrong): I am grateful to the hon. Member for Hornsey (Mr. Rossi) for his kind words at the beginning of the debate, and particularly his assurance of co-operation. I almost rushed across to get him to sign my plaster. I am most grateful to him.
The aim of the new clause is to allow freedom from interest on capital repayments to continue for five years, even if the first-time purchaser sells his house and a new one is bought during that period.
I shall take note of what the hon. Member for Bournemouth, East (Mr. Atkinson) said. With regard to homelessness, I suggest that he should attend the Adjournment debate later this week when that subject will be dealt with in detail. I do not think that his comments in that respect are really relevant to the new clause. I understand his representations concerning regional price limits. He will probably hear me say something about that aspect in reply to the next group of amendments.
The points that were made in Committee—and reinforced today, quite properly and reasonably, by the Opposition—persuaded my right hon. Friend to say that he would have another look at them and give consideration to them. That is what we have done. We have also consulted the lending institutions, which will

have the main job of operating the scheme. But, quite frankly, I have to say to the House that we have been reinforced in the view that our original judgment was correct.
The new clause would complicate the proposed arrangements. We are anxious that the arrangements shall be as simple as posible. The point was quite properly made that the Bill will affect only a limited number of folk. We find that the take-up of most benefits that are available is somewhat disappointing, and we are anxious that this scheme will be as simple and straightforward as it is possible to make it.
The fundamental purpose of the Bill is to assist first-time purchasers, not those who sell and buy again. The one argument that concerns me a great deal is the mobility argument. The hon. Member for Hornsey mentioned it, as, indeed, did the hon. Member for Reading, North (Mr. Durant). We are very anxious indeed not to impede mobility. As the hon. Member for Hornsey will clearly recognise, the evidence is that those who have a house are much more mobile in society than those in other housing sectors. It is true—we have given careful consideration to this—that where people move for employment reasons they are very often assisted by the employer in finding, and even buying, a home. Once a first-time purchaser has been helped into home ownership, he possesses an asset. That is surely an important consideration. He owns an appreciating asset. At most times it is an asset that rises in value. Indeed, very often it would outweigh the value of the Government loan. That was freely acknowledged.
I can give an example. Let us consider a house which costs £12,000 and which the first-timer buys with a deposit of £2,000 and a loan, including Government assistance, of £10,000. Let us suppose that the purchaser moves after three years, during which time house prices rise at, say 10 per cent. a year. He therefore sells at £16,000. After paying off the loan, including the Government loan, he has £6,000 available. Therefore, he could buy a better house—say, £18,000—take a smaller percentage loan, pay the costs of transfer and have some cash left over. Therefore, in the real world we are dealing with very few folk, although we looked very carefully at the matter


because of the strength of the arguments used in Committee.
In addition, compared with the advantage of the bonus and loan assistance which enables a person to become a home owner, the risk of having to move and repay the loan before the five years are up is not, in our view, an overburdening consideration. This would be one of very many matters that would obviously be considered by anyone contemplating moving or having to move for employment reasons.
There is a second reason for resisting the new clause. As the hon. Member for Hornsey suggested, it has to do with administration. We discussed the schemes very fully with the representatives of the institutions before we presented the Bill. Our combined intention, which I am sure has the approval of the House, was to find as simple a scheme as possible which would be to the benefit of both first-time buyers and the institutions. I place on record today the helpful co-operation that we have had from the institutions. They are taking on what will be quite an administrative chore and operating it free of charge. They believe, and we share this belief after talking to them, that the proposal in the new clause would add a genuine complicating factor involving a disproportionately expensive extra burden compared with any benefits which the few people involved may receive.
5.15 p.m.
Under present proposals, the Government loan is contained within the main loan from the lending institutions. When that loan is paid off before the end of five years, so also is the Government loan. It is a straightforward, sensible arrangement which is easily understood. If the £600 loan were continued, we have to consider whether it would be by the lender of the first mortgage loan. If so, there would need to be a new security, because the house would have been sold. There could be difficulty about arrangements for repayments. There could well be disproportionate administrative complications, especially if the Government were to take responsibility for administering the continuing assistance. Frankly, I foresee numerous difficulties concerning security of the loan and collection of payments.

Mr. Michael Latham: I can quite understand that administrative problems cause the Government concern, but surely the building societies cannot seriously be suggesting that these 40,000 people, out of a total of 4·8 million mortgages, would cause an immense administrative problem. The building societies are continually transferring mortgages from one house to another as people sell and buy a new one.

Mr. Armstrong: We must bear in mind the purpose of the Bill, which is to assist a limited number who would otherwise be prevented from becoming home owners. We must consider the administrative complications in relation to the assistance that is being given and what we are asking the lending institutions to do. Let us suppose that an institution making a second loan was then responsible. The problems would then include the transfer of £600, notification to the Government and the reduction of payments for only part of the five years. Indeed, a modified mortgage deed would be required. Last but not least, we must consider the institution's decision whether to make a loan at all, given the requirement to make the £600 additional to its loan, especially if that £600 loan had only a year or so to run.
We are not against the principle of the new clause. We want the scheme to be simple. It is a limited and modest scheme. We want to assist the first-time buyer and avoid any extra administrative burden. I therefore ask the House to reject the new clause.

Mr. Tim Sainsbury: This short debate on an important new clause has raised a point which too often comes before this House. It is an issue which all sides of the House are agreed is worth while. The Minister has recognised the importance of the mobility of labour and the fact that there should be no discouragement of it, yet for administrative reasons nothing can be done to overcome this problem.
I suggest that this is worth having another look at. There is a recognition of the scale of the problem. As I am sure the Minister and his right hon. Friend are aware, many house purchasers, particularly first-time purchasers, do move within the first five years. Indeed, I draw


the Minister's attention to the figures quoted by my hon. Friend the Member for Hornsey (Mr. Rossi), which show that the biggest incidence of movement is in the second or third year after purchase. That is understandable, because there may be changes in the size of family and a first-time purchaser is likely to be at that stage of his career when job movement becomes more likely.
The Minister said that administrative complexity rules out this additional help. I urge him to have another talk with the building societies. The complexity argument seems to be advanced because of the difficulty of transferring what is an interest-free loan for five years from one property to another. If I understand the intention of the Bill correctly, the £600 loan is interest free for five years. Therefore, there will be no repayment and no interest on that loan for the duration of five years. It is secured against a property during that period. At the end of five years repayment and interest become payable on the loan.
If that is the intention—that is certainly how it was set out on Second Reading—there does not seem to be any real complexity in the transfer. After all, as was pointed out by my hon. Friend the Member for Melton (Mr. Latham), normally if somebody is selling his house the transaction for the purchase of alternative accommodation are carried out at the same time. It would be more likely than not that the same building society would be involved. Although I appreciate the Building Societies Association's generosity in operating the scheme without charging for it, if it were discussed with the serious intention of getting it accepted, ways could be found which would not become administratively too complex or expensive.

Mr. Armstrong: I hope that I have not given the impression that the problem is merely administrative. There are two other main considerations. The Bill is related to first-time purchasers and not to those who buy and sell again. In the real world, unless there is a dramatic change in what has happened in most of my lifetime, anybody who buys a home possesses an appreciating asset which in most cases far outweighs the benefit over one or two years—the longer, the bigger

the benefit—of any loan from the Government.

Mr. Sainsbury: I suspect that the Minister is confusing inflation with changes in real value. The value of the house that the first-time purchaser was moving to would equally have increased. The Minister, in a curious way, devalues his Government's own scheme. He seems to be suggesting that the help that is being given is so small the loss of it on moving home would not be regarded as a discouragement. I fear that he may be right in respect of the scale of the help that we are looking for. He is saying that, since it is nothing much to worry about, if after two or three years one wishes to move and as a result one loses an interest-free loan of £600, one should not worry about the administrative complexity of avoiding that loss. I find that surprising.

Mr. Michael Latham: If somebody sells a house for £10,000 and buys a new one, having geared up for £13,000, there are stamp duties, removal costs, and so on, and £600 as well.

Mr. Sainsbury: We are all unpleasantly aware of the costs of moving. We hope that stamp duty will be avoided at that level. It depends upon the level of the exchange. Most of the people benefiting from the proposals in the Bill would be free of stamp duty.

Mr. Stephen Ross: I very much agree with the point that is being made, and I hesitate to interrupt when I see quite a number of lawyers present. If I remember rightly, it is not easy when one is transferring mortgages, whether or not one has an extra £600. When I moved house, I thought that I could simply transfer my £12,000 building society mortgage, which was with the same building society. The building society made me pay it off and take the mortgage out again, and I had to pay the survey fee. It is not a simple exercise. I hope that if the Minister can persuade the Government to discuss the matter with the building societies, they will discuss the simplification of the whole process and not just its effect on those people who happen to have taken advantage of the Bill.

Mr. Sainsbury: I am grateful to the hon. Member for Isle of Wight (Mr.


Ross). Like him. I am not a lawyer. However, I have the advantage of expert advice from my hon. Friend the Member for Hornsey (Mr. Rossi). The point that the hon. Member for Isle of Wight makes about there being a relatively complicated transaction on a change of house is valid, since one has to go through the procedure of repaying the first mortgage and taking out a new one attached to the new property. I do not think that there is considerable additional complexity in transferring the unexpended balance of five years of interest-free loan to the second property. The Minister

recognises the importance of mobility of labour. He surely also believes the scheme to be of real value and the loss of that loan to be a deterrent. If so, will he consider the matter again with the Building Societies Association to see whether it is administratively as complex as has been made out? If it is not, perhaps the matter could be considered in another place.

Question put, That the clause be read a Second time:—

The House divided: Ayes 68, Noes 167.

Division No. 223]
AYES
[5.25 p.m.


Aitken, Jonathan
Haselhurst, Alan
Rees, Peter (Dover &amp; Deal)


Alison, Michael
Hodgson, Robin
Rees-Davies, W. R.


Bendall, Vivian (Ilford North)
Holland, Philip
Renton, Rt Hon Sir D. (Hunts)


Bennett, Dr Reginald (Fareham)
Hordern, Peter
Renton, Tim (Mid-Sussex)


Benyon, W.
Hunt, David (Wirral)
Rifkind, Malcolm


Biffen, John
Irving, Charles (Cheltenham)
Rodgers, Sir John (Sevenoaks)


Brooke, Peter
Jessel, Toby
Ross, William (Londonderry)


Brotherton, Michael
Kilfedder, James
Rossi, Hugh (Hornsey)


Buck, Antony
Kitson, Sir Timothy
Sainsbury, Tim


Budgen, Nick
Latham, Michael (Melton)
Silvester, Fred


Carlisle, Mark
Luce, Richard
Sims, Roger


Channon, Paul
Mates, Michael
Smith, Timothy John (Ashfield)


Clark, Alan (Plymouth, Sutton)
Mawby, Ray
Spence, John


Clark, William (Croydon S)
Maxwell-Hyslop, Robin
Stanbrook, Ivor


Cooke, Robert (Bristol W)
Miscampbell, Norman
Stanley, John


Dodswofth, Geoffrey
Molyneaux, James
Stewart, Ian (Hitchin)


Edwards, Nicholas (Pembroke)
Montgomery, Fergus
Viggers, Peter


Fairbairn, Nicholas
Morris, Michael (Northampton S)
Wakeham, John


Farr, John
Nelson, Anthony
Walder, David (Clitheroe)


Fox, Marcus
Newton, Tony
Walters, Dennis


Gow, Ian (Eastbourne)
Onslow, Cranley



Hamilton, Archibald (Epsom &amp; Ewell)
Page, Rt Hon R. Graham (Crosby)
TELLERS FOR THE AYES:


Hamilton, Michael (Salisbury)
Powell, Rt Hon J. Enoch
Mr. Tony Durant and


Hannam, John
Prentice, Rt Hon Reg
Mr. David Atkinson.




NOES


Armstrong, Ernest
Davies, Bryan (Enfield N)
Henderson, Douglas


Ashiey, Jack
Davies, Rt Hon Denzil
Hooson, Emlyn


Atkinson, Norman
Dewar, Donald
Horam, John


Barnett, Rt Hon Joel (Heywood)
Doig, Peter
Howells, Geraint (Cardigan)


Bates, Alf
Dormand, J. D.
Hoyle, Doug (Nelson)


Bean, R. E.
Douglas-Mann, Bruce
Hughes, Rt Hon C. (Anglesey)


Bennett, Andrew (Stockport N)
Duffy, A. E. P.
Hughes, Robert (Aberdeen N)


Bidwell, Sydney
Dunnett, Jack
Hunter, Adam


Blenkinsop, Arthur
Eadie, Alex
Janner, Greville


Boardman, H.
Edge, Geoff
Jay, Rt Hon Douglas


Boothroyd, Miss Betty
Ellis, John (Brigg &amp; Scun)
Jeger, Mrs Lena


Bottomley, Rt Hon Arthur
English, Michael
Jenkins, Hugh (Putney)


Boyden, James (Bish Auck)
Evans, Fred (Caerphilly)
Jones, Barry (East Flint)


Brown, Hugh D. (Provan)
Evans, Gwynfor (Carmarthen)
Judd, Frank


Brown, Robert C. (Newcastle W)
Evans, Ioan (Aberdare)
Kerr, Russell


Buchan, Norman
Evans, John (Newton)
Kilroy-Silk, Robert


Callaghan, Jim (Middleton &amp; P)
Faulds, Andrew
Lambie, David


Canavan, Dennis
Fernyhough, Rt Hon E.
Lamborn, Harry


Cant, R. B.
Flannery, Martin
Lamond, James


Carter, Ray
Fletcher, Ted (Darlington)
Latham, Arthur (Paddington)


Carter-Jones, Lewis
Foot, Rt Hon Michael
Litterick, Tom


Cartwright, John
Ford, Ben
Loyden, Eddie


Clemitson, Ivor
Forrester, John
Lyons, Edward (Bradford W)


Cocks, Rt Hon Michael (Bristol S)
Freeson, Rt Hon Reginald
Mabon, Rt Hon Dr J. Dickson


Cohen, Stanley
Gilbert, Rt Hon Dr John
McDonald, Dr Oonagh


Coleman, Donald
Golding, John
Maclennen, Robert


Conlan, Bernard
Gourlay, Harry
Madden, Max


Cook, Robin F. (Edin C)
Graham, Ted
Mallalleu, J. P. W.


Cowans, Harry
Grant, John (Islington C)
Marks, Kenneth


Cox, Thomas (Tooting)
Grocott, Bruce
Marshall, Dr Edmund (Goole)


Craigen, Jim (Maryhill)
Hamilton, W. W. (Central Fife)
Marshall, Jim (Leicester S)


Crawshaw, Richard
Hardy, Peter
Maynard, Miss Joan


Cryer, Bob
Harrison, Rt Hon Walter
Mikardo, Ian


Dalyell, Tam
Hart, Rt Hon Judith
Millan, Rt Hon Bruce


Davidson. Arthur
Heffer, Eric S.
Mitchell, Austin




Molloy, William
Rooker, J. W.
Tierney, Sydney


Moonman, Eric
Roper, John
Tilley, John (Lambeth, Central)


Morris, Rt Hon Charles R.
Ross, Stephen (Isle of Wight)
Tinn, James


Moyle, Roland
Rowlands, Ted
Tomney, Frank


Murray, Rt Hon Ronald King
Ryman, John
Torney, Tom


Newens, Stanley
Sandelson, Neville
Urwin, T. W.


Noble, Mike
Sedgemore, Brian
Wainwright, Edwin (Dearne V)


O'Halloran, Michael
Sever, John
Watkins, David


Palmer, Arthur
Shaw, Arnold (Ilford South)
Whitehead, Phillip


Pardoe, John
Sheldon, Rt Hon Robert
Whitlock, William


Park, George
Shore, Rt Hon Peter
Willey, Rt Hon Frederick


Parker, John
Silkin, Rt Hon S. C. (Dulwich)
Williams, Alan Lee (Hornch'ch)


Pavitt, Laurie
Silverman, Julius
Wilson, Rt Hon Sir Harold (Huyton)


Phipps, Dr Colin
Skinner, Dennis
Wilson, William (Coventry SE)


Price, C. (Lewisham W)
Snape, Peter
Wise, Mrs Audrey


Radice, Giles
Spearing, Nigel
Woodall, Alec


Rees, Rt Hon Merlyn (Leeds S)
Spriggs, Leslie
Woof, Robert


Richardson, Miss Jo
Stallard, A. W.
Wrigglesworth, Ian


Roberts, Albert (Normanton)
Stewart, Rt Hon M. (Fulham)



Robinson, Geoffrey
Stoddart, David
TELLERS FOR THE NOES:


Rodgers, George (Chorley)
Summerskill, Hon Dr Shirley
Mr. Joseph Harper and


Rodgers, Rt Hon William (Stockton)
Thomas, Ron (Bristoll NW)
Mr. Frank R. White.

Question accordingly negatived.

Clause 1

ADVANCES TO LENDING INSTITUTIONS

Mr. Bruce Douglas-Mann: I beg to move Amendment No. 1, in page 2, line 7, after 'savings', insert 'income and capital'.

Mr. Deputy Speaker: With this we may take the following amendments: No. 5, in page 2, line 15, after 'savings', insert
'and the third condition is that he shall provide evidence that he would not be in a financial position to purchase the property without the assistance of a loan of at least 70 per cent. of the purchase price and that such loans would be of an amount not less than double his annual income.
No. 6, in page 2, line 32, leave out 'both' and insert 'all three of'.
No. 7, in page 2, line 34, after 'first', insert 'and third'.

Mr. Douglas-Mann: The purpose of these amendments is to ensure that the assistance provided by the Bill is concentrated upon those who might not be able to afford the purchase of a house without the assistance that the Bill provides. On the face of it, any measure that provides additional assistance for those who are buying a house for the first time seems a very good thing. It is quite clear that it has a very wide appeal to hon. Members on both sides of the House.
I ask hon. Members to consider what the effect of indiscriminate assistance to house purchase is likely to be. To what extent, by simply pushing additional money into the house purchase market, are we merely pushing up the price of

houses without increasing the supply in any way? My amendment is designed to ensure that that assistance is concentrated on those at the bottom end of the market who would not otherwise be able to afford to buy, and where there is considerable scope for increasing the supply.
To illustrate the effects of my amendments, Amendment No. 5, contains the essential provision that there should be an additional condition to the payment of assistance under the Bill. This third condition would be that the applicant would have to provide evidence that he would not be in a financial position to purchase a property without the assistance of a loan of at least 70 per cent. of the purchase price of the house and, furthermore, that such a loan would be of an amount not less than double his annual income.
If I can give an illustration, under the financial limits contemplated in the Bill we are told that in Greater London, if the Bill were in force now, a first-time buyer purchasing a property for a price of up to £16,200, would be eligible for assistance. The sum of £16,200, even in London at the present time, will buy a very nice bachelor pad. It will buy quite a reasonable, small single-room flat. For somebody who has ample means and an adequate income, the effect of providing the assistance that this Bill will provide and which somebody—even though he has the income and the capital—is likely to be entitled to receive under this Bill, will merely enable him to pay still more for his flat than he would have done otherwise.
The purpose of my amendment is to ensure that this assistance is restricted to those with relatively small incomes—though not that small. If we take a flat at


£16,000 in London at present, my amendments would provide that under the scheme nobody would be eligible who was in a position, because of his capital, to purchase without the assistance of a mortgage of up to £11,200. He would not be eligible, either, if his annual income was in excess of £5,200.
I ask my hon. Friend to consider to what extent it is desirable for us to provide assistance out of public funds—I would have no objection if there were unlimited funds available—to somebody with an income over £5,000 a year or somebody who is in a position to put down more than £5,000 on his house. In the absence of my amendments, that is what the Bill would provide.
At present, only about one out of five first-time buyers is buying a new house. That means that four out of five first-time buyers are buying existing houses and that four-fifths of any money that we provide to assist the generation of additional demand will generate instead an increased demand for existing houses. Four-fifths of the money flowing from this Bill will go towards inflating the price of houses and will not generate additional demand for new houses coming onto the market.
Therefore, the principle upon which the Bill is based is fundamentally wrong. I admit that I welcomed the Bill on Second Reading, but the more we discussed it during Committee the clearer it became to me that the measure would not help those who need it most. If the Bill were concentrating help at the bottom end of the market—on those who would not otherwise be able to buy their own homes—I would very much welcome it, but to the extent that the Bill provides assistance to those who would be able to buy anyway, I think it is wrong.
I recognise that such people need help and that they are having a tough time, but the fact remains that they are able to buy anyway. To the extent that the Bill enables them to cope with their difficulties a little more easily, it is self-defeating. It will not help them in practice; it will simply inflate the price of houses. It must do. When only one in five new house purchasers are buying new houses, it cannot generate additional supply. It will only push up house prices.
If we were able to concentrate the additional money on those who would

not otherwise be able to buy, it might well attract additional property into the market. I have in mind particularly the potential buyer who is a sitting tenant in private rented accommodation who would be in a better position to buy his house with the assistance available under the Bill. I also have in mind the buyer of property which is at the lowest end of the price scale. Without my amendments we will not be able to help such people.
It may well be that the existing first and second conditions incorporated in the Bill will ensure that those with the greatest amount of family backing will benefit most. These are the ones with financial advisers. These people will be advised to ensure that they have £300 in their accounts in 1979 and they may well be helped by relatives in topping this up to £600 by 1980. This would enable them to get maximum assistance under the Bill.
We must also bear in mind that the Bill is limited in scope because the amount of money involved is not very great. There is provision in Clause 1(6) for the Secretary of State, by order, to alter the sums specified in that clause. We have already heard from the hon. Member for Hornsey (Mr. Rossi) that if he is ever in a position to exercise the powers of Secretary of State he intends to increase greatly the scope of the Bill.
At present the £100 million will have only a limited effect, for good or for ill. If the hon. Member for Hornsey got his hands on the necessary powers, he could cause a lot of harm. I fear that under the leadership of the present Leader of the Opposition he would be under considerable pressure to do so, even though his own judgment might advise him against this, as I believe it would. Therefore, I ask hon. Members to consider very carefully whether tighter restrictions—whether they are those outlined in Amendments Nos. 1, 5, 6 and 7 or in some other form—should not be introduced in another place.
As the Bill stands, there is no adequate restriction on its scope in order to ensure that help goes where it is most needed rather than to those who would otherwise be able to buy their own homes Without such restriction the Bill is damaging and is more likely to result in increasing house prices than in providing any significant


assistance to those who could not otherwise afford to buy their own homes.

5.45 p.m.

Mr. Michael Latham: The hon. Member for Mitcham and Morden (Mr. Douglas-Mann) raised an issue of considerable importance. I want to echo some of his thoughts, although I do not feel that his amendments are at all satisfactory.
Amendment No. 5, which is the substantive amendment, says that
the third condition is that he shall provide evidence that he would not be in a financial position to purchase the property without the assistance of a loan of at least 70 per cent. of the purchase price and that such loans would be of an amount not less than double his annual income.
The hon. Member did not tell us how that evidence was to be provided, to whom it was to be provided, or in what way it was to be assessed. I assume that in some way he would have to satisfy the lending institution that he had attempted to buy houses at the ruling price and had not been able to afford it. It would, in effect, be a means test. That is not necessarily in any way objectionable, but the House should know clearly what is being proposed.
The hon. Member's proposal has more weight in principle—although I believe it to be defective in detail—in that it allows the House to face the reality of the position—that we are consciously attempting in two years time to inject new demand into the market.
The Minister said in Committee:
we believe that there would be approximately 200,000 people benefiting by the operation of the Bill, of which—I speak now without checking the papers on this—about 30,000 to 40,000 would be additional people outside the margin of purchase now but who would come within the margin of purchase."—[Official Report, Standing Committee A, 4th April 1978; c. 14.]
Therefore, 200,000 people, of whom between 160,000 and 170,000 would have been in a position to buy houses anyway, will benefit from the Bill.
What worries me is whether we are doing a wise thing by attempting to inject more purchasing power in two years without knowing anything about the financial conditions that will exist in the housing market at that time. Indeed, it is very difficult to know the financial condition in the housing market at present. I give a simple illustration. I have

with me two publications, one from the Building Societies Association and one from the Nationwide Building Society. The Building Societies Association document, entitled "Facts and Figures", published in April this year, says:
It appears likely that in the first quarter of 1978 prices in general were about 3 per cent. higher than in the fourth quarter of 1977 so there has been an acceleration in the rate of increase of house prices but certainly not something which can be termed an 'explosion'.
However, the Nationwide Building Society, in a document published at the same time, says:
House prices rose by an average of 5 per cent. in the first quarter of 1978 which was the largest quarterly increase since 1973 and compares with an average of 1 per cent. in the fourth quarter of 1977
Therefore, at the precise time that we have the Building Societies Association saying that there is no cause for alarm and that 3 per cent. is certainly not something that constitutes "an explosion", we have the Nationwide Building Society—the third largest building society, and a very respected one—talking about the largest quarterly increase since 1973, which has resulted in considerable Press comment and speculation about a possible explosion.
The feeling that came out of a report such as that of the Nationwide Building Society is the sort of thing that has induced the Secretary of State to agree with the Building Societies Association on a restriction on their lending to £610 million a month in order to try to take the steam out of the housing market.
The House-Builders Federation, in its latest report, refers to the sharp deterioration in the availability of mortgage finance. It states that
The sharp deterioration in the mortgage situation is confirmed in … the inquiry. These show that from a trend of gradually improving mortgage availability and processing, as reported in the last few enquiries, the picture has swung suddenly and substantially in the opposite direction.
If that is the position now, if building societies are now finding difficulty in agreeing on the rate of the house price increase, and if the Government—I shall use not the emotive phrase but the neutral—decided to take the heat out of the market to deal with the problem that may or may not exist, how much more difficult it will be to judge the market


in two years' time. We are, therefore, in much more difficulty in saying that at this moment we should set up a scheme to inject purchasing power into the market in two years' time.
I do not believe that the amendment provides the right way of dealing with the problem. The elaborate means-testing system and the arbitrary 70 per cent. are unworkable. If we are to go ahead with the scheme, as manifestly we are as it is the will of the majority of the House, although one or two hon. Members such as the hon. Member for Mitcham and Morden and myself have doubts, we must at least ensure that there is careful monitoring. It would be disastrous if in two years' time the scheme were to go into operation and produce a substantial influx of new money into the market when the market was rising naturally anyway.
I remind the House of the similar action that was taken by President Nixon in his Federal Housing Act 1969. The President decided that he wanted to pick up the private housing building industry, which at that time was on the floor. A new scheme was produced that brought in more money. It picked up the market substantially—so substantially that the scheme had to be terminated after a couple of years because it was extremely inflationary.
We need to consider these matters carefully. I utter cautioning phrases although I know that some of my hon. Friends will not welcome them. However, I believe that such fears should now be expressed.

Mr. Armstrong: My hon. Friend the Member for Mitcham and Morden (Mr. Douglas-Mann) has been consistent in expressing his reservations and doubts about the Bill throughout the time that it has been before the House, either on the Floor of the House or in Committee. Today he has tabled amendments to forward the principle that he has repeated quite often about providing assistance to those who need it most. That is a principle with which I do not disagree in any way—indeed, I support it.
I tell the hon. Member for Melton (Mr. Latham) that we shall monitor carefully the effects of the Bill. I take seriously some of his comments. They were

relevant, in a way, to the amendment although not strictly relevant to my hon. Friend's proposals.
I doubt very much whether the effect of the amendment would help to achieve the principle that my hon. Friend has so often put before the House. The adoption of the amendment—I understand that he would not disagree with this—would be tantamount to introducing a means test. The purchaser would have to produce evidence that he was not in a position to purchase without a loan of at least 70 per cent. That would mean that some deserving cases would be denied assistance.
There are those whose income is too small to contemplate a large loan and there are others who are approaching the end of their working life. Those in the latter category may have saved over a number of years and with a relatively small loan and with relatively large savings they may just be able to manage to become home owners. It cannot be right to exclude those from the scheme that we are introducing.
The second element in my hon. Friend's proposals is the need for the loan to be not less than double the purchaser's annual income. Surely that, too, could work unfairly. Let us think for a moment of parents with large families or parents whose incomes are liable to fluctuate. It would be foolish to encourage them to undertake a large loan. How is income to be assessed? Is it to be the joint income of husband and wife? We know that practice now varies a great deal.
The amendment would complicate these matters unduly and could act unfavourably on some would-be home owers.

Mr. Douglas-Mann: My hon. Friend asks how income is to be assessed. On every application for a building society loan details of income have to be provided. In the table of facts and figures from the Building Societies Association, to which the hon. Member for Melton (Mr. Latham) referred, there are details of the average income of the first-time buyer, from which it is clear, as matters stand, that he is obtaining a loan of about 80 per cent. of the value of the house that he is purchasing. The loan is a little under 80 per cent. but well over 70 per cent.
The first-time buyer is getting an average advance that is slightly under twice his income. The purpose of the amendment is not to add to bureaucratic procedures. That procedure has to be gone through in any event. The purpose is merely to restrict the benefit to a significant proportion but not to a minority.

Mr. Armstrong: I do not quarrel with what my hon. Friend has just said. However, if we are extending the qualifications when considering the eligibility of would-be purchasers for assistance under the scheme, each individual would have to be considered in a much more detailed manner than at present. It is no good talking about averages. Each application would have to be considered because the applicant's eligibility would have to be determined in a precise way.
That which my hon. Friend seeks so as to ensure that money goes where it is most needed is best covered in the fairly simple scheme that we have proposed, which incorporates regional price limits combined with the minimum size of mortgage loan. Surely that is the best way of giving assistance to those who really need it without building up the whole paraphernalia of income testing that the amendment would involve.
We have necessarily included safeguards to ensure that help goes where it is most needed, to enable those who would otherwise be excluded, or who are just on the margin, to receive assistance. We consider that our proposals would have that effect. I ask my hon. Friend to withdraw the amendment.

Mr. Douglas-Mann: I believe strongly that the amendment is desirable. I appreciate that there is not a body of support in the House, but I feel that I cannot withdraw the amendment.

Amendment negatived.

Mr. Sainsbury: I beg to move Amendment No. 2, in page 2, line 10, after 'date', insert 'of the approval'.
The amendment arises out of a suggestion from the House-Builders Federation that we discussed at some length in Committee. The Minister said, towards the end of that discussion:
I see the attraction of handing over the benefits as quickly as possible, and it is the intention of the amendment to do so at the

first possible moment."—[Official Report, Standing Committee A, 4th April 1978; c. 26.]
The right hon. Gentleman raised some technical objections to the means of arriving at a position where the benefits were handed over, as he said, "at the first possible moment", which we, the Opposition, took as valid. I hope that the amendment meets those objections. Subsection (3) would then allow assistance to be given to people who
have been saving with a recognised savings institution for at least two years preceding the date 'of the approval' of his application
rather than the "date of his application".
6.0 p.m.
Clearly, as the Minister recognises, time is taken in processing an application for a mortgage. Time will also be taken in processing an application for help under the scheme. If the purchaser has to wait two years before making his application for assistance, there will inevitably be further delay in the procedure of house buying, which is often more lengthy and subject to delay than people would like.
I see no objection to allowing an applicant to apply for assistance well in advance of the two-year deadline in order to clear paperwork and receive approval, subject to his fulfilling the conditions set out in subsection (3) at the deadline point.
The Minister's objections to the amendment originally introduced in Committee do not apply to the revised wording. I suggest that if we allow an earlier application—if we allow the paperwork, and so on, to be cleared before the completion of the two-year period—although we may not save an enormous amount of time—probably only two months, but it is still worth saving—we may save applicants some worry about their eligibility and the amount of help that they may expect to receive. Therefore, I commend this simple amendment to the House.

The Minister for Housing and Construction (Mr. Reginald Freeson): I fear that the difficulties that I described in Committee have not been resolved by the change in the drafting, as I hope to show the hon. Member for Hove (Mr. Sainsbury).
Like the Opposition, I want the benefits of the scheme to be paid as soon as practicable after the two-year savings


period. The efforts of Opposition Members to find ways of shaving off a few weeks would, I fear, result only in confusion. Indeed, they could possibly cause delay rather than bring forward the date of payment.
The savings period must end on the date of an event which is certain to occur. It is the only way in which we can get qualification. It is no good stipulating a closing date which is both unpredictable and outside the purchaser's control. I say this because there is no requirement under the Bill, nor indeed in the amendment, for the application for assistance to be approved by the lender at any particular date.
Even if such a requirement were made, the prudent lender would not give formal and final approval until he was certain that all the conditions had been fulfilled, and he could not be certain of that until the purchase had been completed. He could not be certain when, as was suggested by the hon. Member for Hove, the application was processed "well in advance of the end of the two-year period". It could not be known at that stage that the conditions which would qualify for benefit under the scheme had been met.
If assessment were delayed until the purchase had been completed, the purchaser would be unable to use his savings at the very time that he most needed them—I made this point strongly in Committee and I repeat it now—namely, in the period between making a "subject to contract" offer and completing the purchase. At best, the amendment would result in additional and unnecessary administrative procedures. At worst, a purchaser might be unable to use his savings when he needed them or, if he used them before the period was up, he might be deprived of assistance altogether.
I explained at some length in Committee why the date of application, which is under the control of the purchaser, is by far the best closing point. It frees the purchaser's savings at the earliest possible moment for the various purposes to which he wants to put his savings in connection with the purchase—sometimes in connection with the start or the commissioning of repairs which can be required by a building society on an older property—and it enables the lender to process the

application for assistance in an orderly way. The lender needs to know whether the savings conditions have been satisfied before deciding the amount of total loan. He cannot be certain of that until there is simple documentary evidence that the savings conditions have been satisfied.
I shall try to make this point by reference to an example. I cannot remember whether I did it in this way in Committee. The amendment would mean that a would-be purchaser might apply for assistance with less than £600 in his account, because he would be making his application ahead of the completion of the period. How can the institution approve it at that stage without knowing the outcome of the qualifying period with regard to savings?

Mr. Sainsbury: We seem to be going over the discussion that we had in Committee. I thought that I had got the Minister to accept that in life many things are approved subject to a condition being fulfilled, including the purchase of a house. The purchaser will buy "subject to contract", sometimes "subject to survey" and nearly always "subject to a mortgage". This is not unusual. This is a normal process.

Mr. Freeson: That reinforces the point that we are creating uncertainty, not certainty, in the operation of the scheme. Such uncertainty will be particularly damaging to the applicant. It will also be difficult for the lender. The hon. Gentleman's intervention confirms the point that I made in Committee, and make now, that the operation of the scheme depends on qualifying conditions. If this proposal operates one, two, or more months in advance of the period of completion, as was suggested, we shall create an unknown quantity of uncertainty in the operation of the scheme for both the lender and the prospective purchaser.
The institution will not be able to determine its final loan offer until it is sure that the applicant has reached £600, or it might assume that the conditions were not going to be met—it could make such a judgment on the information before it—and make a lower offer accordingly. The institution can make a considered offer of total loan, including the extra £600, only in response to an application made when the savings conditions have been met.
It would not be reasonable to require the institution to determine eligibility for the Government loan on the same day as it makes its offer. How could it obtain satisfactory evidence of the purchaser's balance at the kind of period which has been broadly estimated by the hon. Gentleman and which I have accepted as the basis for his thinking, namely, two months or more before the completion of the period? That kind of information is not available instantly.
I accept the underlying motivation of the amendment in principle, as I said in Committee, but I do not think that the proposal is workable. I think that it would add confusion and difficulty to the operation of the scheme.
We have been back to the institutions on this and on a number of other matters. We have consulted essentially the building societies, but others have been involved. They confirm our view. Of course, they will have to administer the scheme. Our proposals will work, because they have been worked out in conjunction with the institutions.
I appreciate that there has been a small change in the wording of the amendment compared with the proposition put forward in Committee, but it does not meet the difficulties that were raised at that time and which I have repeated today. Therefore, I hope that, on reflection, the hon. Gentleman will accept what I have said today and will seek leave to withdraw the amendment.

Mr. Sainsbury: I think that the Minister's advisers are very skilled at finding a whole series of difficulties which might apply to a small number of cases only and making them sound even worse than they are.
I appreciate that there are some valid doubts whether the amendment would make the scheme more administratively complex. I wish that I had confidence that the Minister had pursued with more energy the intention that he expressed in Committee about making the help available as quickly as possible. If that were a real intention, I think that he should have been able to find ways of enabling people to get through the paperwork in advance.
In the light of what the Minister said, however, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Mr. Douglas-Mann: I beg to move Amendment No. 4, in page 2, line 15, leave out '£600' and insert:
'a sum at least equal to the amount of assistance for which he is making application under subsection (4)(a) below'.

Mr. Deputy Speaker (Mr. Oscar Murton): With this we may discuss Government Amendments Nos. 10 and 11.

Mr. Douglas-Mann: The purpose of this amendment is to enable an applicant to obtain assistance under the Bill if the amount that he has saved falls short of £600. It would enable the applicant, as of right, to receive assistance up to the amount that he has saved. If he has saved £500 he will be entitled to £500 worth of assistance under the Bill.
I am pleased to see Government Amendments Nos. 10 and 11, which enable the Secretary of State to achieve the same result by order, but I should have preferred this provision to be incorporated in the Bill. Earlier in the debate I expressed anxieties about what the hon. Member for Hornsey (Mr. Rossi) might do with that power. I am apprehensive about the ways in which he might exercise that power were he given the opportunity.
The Government have shown their good will in their amendments, and I do not propose to press my amendment. The value of the Bill lies in the extent to which it will help those who are at the margin. I have grave reservations on the question whether we were wise to incorporate the savings provisions in the Bill. The picture in the Bill is that of the young couple carefully putting away money each week in a building society so that they will be able to purchase a house after a two years' savings period. Although house prices have not increased so much in the last two years they are starting to accelerate again. If someone is not in a position to purchase a house now, after a two years' savings period he might be in an even less favourable position to purchase.
Those who are most likely to qualify through the savings conditions are those whose parents are in a position to assist


them. Originally I welcomed the savings conditions, but on reflection I feel that in practice they will be fulfilled by those whose families are able to help them rather than by those who rely entirely on their own efforts.
Since there are savings conditions it is desirable that someone who has not quite reached the target should, nevertheless, be able to obtain reduced assistance under the Bill. The Government amendments would enable this to be done by order. In those circumstances, I do not wish to press my amendment.

Mr. Freeson: I assure my hon. Friend the Member for Mitcham and Morden (Mr. Douglas-Mann) and the hon. Member for Reading, North (Mr. Durant) that the arguments advanced by them in Committee have been carefully considered. I have sympathy with the objectives of the amendment. The Bill can help to direct assistance to those, especially in the inner cities, who are seeking to buy cheaper houses or those who wish to join certain types of co-ownership schemes such as community leaseholds and certain types of shared equity schemes which will also qualify the individuals concerned so long as they have individual mortgages.
6.15 p.m.
Because of the thought that I gave to the subject even when the Committee was debating the matter, I concluded that we should do something along the lines set out in Amendment No. 11. I believe that that represents a more flexible method of dealing with the problem. It will permit the introduction of a sliding scale when we have more experience of the practical operation of the scheme and when we are persuaded that the need for it is established.
It is only fair that I should put on record again my doubts about a sliding scale of loan. One of great virtues of the scheme is its simplicity. There are two elements—the £600 single value loan and a simple sliding tariff. To underline the simplicity the final saving required for the loan is also a single figure—£600. Amendment No. 4 would introduce a sliding scale involving any amount between £300 and £600. I fear that this might diminish the effectiveness of the scheme.
The proposed scheme is intended to encourage people to achieve a reasonable

level of savings before purchase. Unlike my hon. Friend the Member for Mitcham and Morden, who has had second thoughts, I stand by the scheme because it involves an important principle. This measure should not be undertaken other than on the basis of a partnership between the State and the individuals concerned. That is why I stand by the principle of saving/lending assistance, plus the bonus in the scheme.
Money is needed for deposit, survey, legal fees, removal expenses, and initial works. I am aware that sitting tenants have no removal expenses, but the majority of people have transaction costs of £300 or more, rising to the figure in the Bill. Except in the few cases where 100 per cent. loans are offered, £300 is not enough for this type of initiative. We did not choose £600 out of the blue. We thought carefully about the right level that would set a reasonable but not impossible target.
Since the Committee stage I have asked for the views of the building societies which will administer the scheme free of charge on behalf of the Government. They confirm that a sliding scale would add substantial complications and that a separate calculation for each loan, depending on its value, would have to be made.
I do see the force of the counter-arguments. That is why I have tabled Amendment No. 11, which will empower the Secretary of State to introduce a sliding scale of loan by order when we have had more experience of operating the scheme, subject to negative resolution procedure.
If we find that among those buying cheaper houses a significant proportion are unable to save up to £600 an order can be made to introduce a sliding scale. We shall be able to discover this by the strict monitoring of the scheme that we propose. I envisage that we might have a tariff on the lines of the bonus, but not as suggested by my hon. Friend, although it would have the same objective if we were to go along that road.
There would be a number of fixed points in the tariff. For example, there would be a £300 loan for £300-£399 of savings, a £400 loan for £400-£499 of savings, and so on. This system would retain some of the simplicity which is so important to the purchasers as well


as to the institutions that will administer the scheme.
I hope the House accepts the approach that we have adopted on this matter in our consideration of the views expressed in Committee—views with which I have some sympathy—and will accept Amendment No. 11.

Mr. Rossi: I thank the Minister for tabling Amendment No. 11 and for meeting the case that we put to him in Committee for greater flexibility in the scheme. We accept, of course, the administrative problems that he has had to face in his discussions with the building societies, in seeking to produce a simple scheme, but we had very much in mind the fact that £600 of savings over two years represents £6 a week out of a net income, after tax, for a young couple.
That is not an easy matter for the kind of people who are acquiring property, in inner cities, for example, on 100 per cent., 95 per cent. or 90 per cent. mortgages. In these circumstances, the £600 requirement of savings over two years could have been an insuperable barrier and contrary to the general interest of trying to make home ownership available to people in those circumstances.
I hope that the Minister, having accepted those arguments and having brought forward the kind of amendment that we were seeking, will not allow this proposal simply to lie upon the statute book un-noted, but will quickly bring forward a scheme so that the people to whom I have drawn attention may benefit. If these people are able to save only £300 over two years they will get the advantage of a £300 loan. That will be a considerable help to them in meeting all kinds of expenses they will incur, even though they may have a 100 per cent. mortgage to cover the purchase price of the property. To that extent, I once again thank the Minister.

Mr. Douglas-Mann: Although I was slightly disappointed at the tentative tone in which my right hon. Friend the Minister set out his intentions to introduce this proposal, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Mr. Armstrong: I beg to move Amendment No. 8, in page 2, line 34, at end insert
'but he does not in any case qualify unless the amount of the secured loan is to be at least £1,600 and not less than 25 per cent. of the purchase price of the property.'.

Mr. Deputy Speaker: With this we may also take Government Amendment No. 9.

Mr. Armstrong: These amendments arise from the discussion in Committee. We took seriously the concern expressed there about the need for parliamentary control over the key elements of the scheme, and in particular we have taken on board the very strong arguments advanced by the hon. Member for Reading, North (Mr. Durant) about the importance of the lower limit to the value of the loan from the lending institution which will attract Government assistance.
We therefore want to give assistance only in cases where the secured loan is at least £1,600—that is, £1,000 plus the Government's £600—and where that represents at least 25 per cent. of the purchase price. To set an even lower limit or no limit would bring in more first-time-purchases, but people who took such a small loan would be showing that they did not need assistance. Smaller loans can cause a massive amount of extra work in the arrangement of payments and repayments over a longer period. We would not want to set the limit too high, however. There are district councils that give loans of around £2,000 to help young couples who are buying for the first time small terraced houses that they are prepared to renovate and improve.
Careful consideration has brought us to the same view as that held by the working party, which was composed of experts from local government, the banks, the building societies and insurance companies, about the size of the minimum loan. The figure is £1,600 including any Government loan. The figure is about as low as we should go, we believe, and it should ensure that the assistance goes to the deserving young couples I have mentioned.
As with other requirements in the Bill, there would be a power for the limits to be varied by means of an order subject to the negative resolution procedure.

Amendment agreed to.

Mr. Rossi: I beg to move Amendment No. 20, in page 2, line 34, at end insert—
(6) Those who have been saving with a recognised savings institution for at least two years preceding the appointed day of this Bill will qualify to receive assistance under subsection 4(a) and (b) immediately from the appointed day by satisfying the second condition of subsection (3) provided that the loan is applied to the purchase of a recently built house not previously occupied as a home by any other persons".
The purpose of the amendment is to add a subsection to Clause 1 to deal with the situation in which people have been saving regularly up to the time the Bill becomes law to enable them to qualify for some of the benefits under this measure.
As the House has already been told this afternoon, the Government's intention is that the assistance under the Bill will not operate for two years after it becomes law. In other words, if it received Royal Assent next month, people would have to wait two full years from then—until the summer of 1980—before they could derive any benefit.
One can see that this is a valid proposition in respect of the tax-free bonus on savings, otherwise it would mean that the bonus would be given retrospectively on savings made in the past. With loans, however, the proposition about retrospective revenue legislation does not apply.
One of the difficulties that will be caused by the way in which the Bill is to be operated, requiring two years of savings before the loan can be made, is this. There may be those who will be tempted to hold back from buying a house, in order to take advantage of the scheme, until the end of the two-year period. If a lot of people took that attitude, the housing construction industry would be in difficulties.
I do not have to tell the Minister of the difficulties of the housing construction industry or of how many hundreds of thousands of unemployed building workers there are. Any measure that further damped down demand for two years should therefore be avoided. The anxiety that I express has been expressed to me by the House-Builders Federation. It is extremely worried by this aspect of the Bill.
There is a further extension of that proposition. Not only will demand be

damped down during the two-year period while people are saving, but at the end of that period demand will surge for houses that are not available, and that will serve only to increase the prices of those that are available.
We discussed this matter at some length in Committee and I detected in the Minister's reply sympathy for the problems of the house builders. However, the right hon. Gentleman did not wish to take up our proposition in respect of all house purchasers. He recognised the problem on new houses but felt that nevertheless he should retain the two-year delay on the purchase of secondhand houses and that the £600 loan should, therefore, be delayed for two years in respect of those houses.
6.30 p.m.
Therefore, there is a difference between the amendment that is before the House today and the amendment as it appeared before the Committee, because, in order to meet the objections raised by the Minister and to try to spell out specifically the fact that we were anxious not to cause greater problems for the house builders than they have at the moment, we have added words at the end of the amendment as follows:
provided that the loan is applied to the purchase of a recently built house not previously occupied as a home by any other persons.

Mr. Douglas-Mann: I am in many ways greatly attracted to the idea of concentrating assistance on new houses which have not previously been occupied, for reasons that I have indicated in other speeches. But I was wondering how the hon. Member's scheme would operate. Is he aware that, according to the facts and figures of the Building Societies Association, to which reference was made earlier, in February the prices of new houses were 15·2 per cent. higher than those of a year earlier, whereas existing house prices were only 7·9 per cent. higher? Therefore, it is the price of new houses that is rising most rapidly and this, as the Building Societies Association argues, is a consequence of additional demand, principally from purchasers of new houses.

Mr. Rossi: I am aware of those figures, but the price of new houses as distinct from second-hand houses is dictated mostly by the increase in construction costs. Looking at the figures produced


by builders, one sees that their margins are very limited indeed. The problem that many of them have is that, having to construct new houses at these higher prices because of increased construction costs, they find that in some parts of the country they are unable to sell because second-hand houses of equal quality are being sold cheaper. Therefore, I do not think that the hon. Member should rely too much upon those figures in dealing with the point I am trying to make in regard to this amendment.
Because the builders are in that difficulty, it is even more important that we give some immediate aid now in order to encourage them to build more houses and not to draw back from so doing by damping down demand even more than it is damped down now in this sector in some parts of the country.
This is a matter that the Minister recognised. This was the tenor of his reply to our representations in Committee. That is why the amendment is presented to the House in this form. As we have sought to produce the amendment in this revised form, in order to meet the expressions of interest of the Minister in Committee, I hope that he will now see his way to accepting it. We could go no further to meet his wishes than as we have done.

Mr. Stephen Ross: I also find myself very much attracted to the new amendment. I think I said on Second Reading that the example in Ireland was that when the new Government came to power there they introduced a measure to help home purchasers which was directed entirely at new house building to give a stimulus to the building industry generally. I see this as giving just such a stimulus, which I think the industry still needs. I can see the strength of the argument.
I was all for an outright cash payment to start with. The longer that one debates the Bill, the more one sees the snags creeping in. Therefore, I personally think that the Government have got it right. I can, however, see strong arguments for this amendment to try to give some impetus to the new house building industry now to encourage first-time home buyers to try to concentrate a little more on this aspect, and certainly to avoid what may well happen in two years' time, as the hon. Member for Hornsey (Mr. Rossi)

has quite rightly said—a sudden upsurge of demand for the older type of property. One can foresee that.
I am already advising people who come to see me that the Bill is coming forward and that, if they are patient and save, in a couple of years' time they will benefit from the bonus that the Government will be providing. If there is some way in which we can introduce this measure earlier and direct it at new house building, there is everything to be said for it.
I am sure we shall be told that this is too complicated and would mean more bureaucracy. I take very much to heart the ideas of the Government that this should be a simple scheme, but I suspect that the building industry will be in need of an added stimulus. I do not think that anyone present will say that it is working at full steam. It is certainly not doing that. We need a great many more houses built in Britain.
I do not know whether any hon. Members watched the television programme "Open Door" last night. It absolutely reiterated what I think most of us had known all the time—that there is no alternative, if we are to deal with our situation, to building a great many more houses. Certainly we need many more houses built in the inner urban areas.
Therefore, if there is some way in which the Government, if not accepting this amendment now, could try to meet the spirit of it, either by the way in which they dealt with Amendment No. 11—bringing it in by order—or by a further amendment in the other place, they would be doing a service, because it would help the Bill to operate much more smoothly than it may do. One can foresee pitfalls ahead.
I want to see this measure succeed, as I am sure everyone else does. I think that it is quite a bold move. It is a move in the right direction. As I said, the Government have got it about right. I do not support the idea that one can pump very much more money into this. I have listened with great interest to the hon. Member for Mitcham and Morden (Mr. Douglas-Mann), because I see the Bill, in some of its aspects, adding to inflation, which is just what we do not want to happen to house prices. The Government have a very difficult task in trying to keep the lid on house prices. They may well have been right in their conversations with the building societies


to try to restrict lending. I certainly never want us to return to the circumstances of the period of 1972–73—certainly 1972, anyway.
I know that we are dealing with a very delicate mechanism, but if there is some way in which the amendment can be met I think that it ought to be met. I hope that the Government will see their way to doing so.

Mr. Douglas-Mann: I sincerely trust that my right hon. Friend the Minister will not be tempted to accept the amendment. It is unlikely that he will do so, because he is clearly aware—this is the reason why the Bill has been framed in this way—that the impact of the Bill will be to add to demand. Unless the builders have the opportunity of preparing for that additional demand, the sole impact will be on house prices.
My fear is that that will be the effect in two years' time. It would certainly be the effect if the Bill were introduced now, even if it were restricted in the manner suggested by the hon. Member for Hornsey (Mr. Rossi) in the amendment.
I should like to commend to my right hon. Friend the concept of restricting some of the kinds of assistance that we give to house owners and house purchasers to those who are purchasing new houses. The sole real argument in the Green Paper against a reform of the system of housing finance could be summarised as saying that, if it had not been for the overall assistance—the £1,100 million a year—that we give to mortgagors through mortgage interest tax relief, no one would have been able to afford to buy any houses at all. That is the implicit argument in the Green Paper, and it is the implicit argument put forward by the hon. Member for Hornsey just now in reply to my intervention.
I would commend both to Ministers and to the lion. Member for Hornsey Figure 5 on pages 20 and 21 of the Green Paper. That shows that the real effect of increased demand is a sudden acceleration in land prices rather than in the costs of the construction industry. The costs of that industry have remained extraordinarily stable. Earnings in the building industry have closely followed the pattern of national average earnings, whereas land prices fluctuate wildly in response to increases in demand.
I would also commend the leading article in the Building Societies Association's facts and figures paper. The BSA is not a body on whose facts and figures I would strongly rely—I have frequently been in disagreement with ifs approach to housing finance—but in the current issue I find strong support for my views on the immediate or long-term implementation of the Bill in an undiscriminating way. The BSA says:
The rise in prices is not, as some commentators maintain, pricing first-time buyers out of the market. Rather, it is the precise opposite which is occurring. Because so many first-time buyers are seeking to enter the market, the price of houses is rising.
That argument is well supported by the facts and figures in the article.
The amendment would lead to additional demand. There would not necessarily be more first-time buyers, but there would be more first-time buyers with more money to spend, able to generate instant additional demand, with no possibility of any increase in supply to meet it. That would immediately produce a further surge in the price of houses. The amount involved might be very small, but the principle is fundamental.

Mr. Stephen Ross: I am following the hon. Gentleman's argument with interest. However, two or three years ago many hundreds, if not thousands, of new properties were standing empty because of lack of demand. There was a big municipalisation programme. Local authorities were stepping in to buy some of those houses—with some odd consequences. We are talking of a limited number of people anyway. Does the hon. Gentleman think that, by going some way towards the amendment's objective—by directing this money towards new house building—prices would be pushed sky high? I do not agree.

Mr. Douglas-Mann: I do not say that they would be pushed sky high. I say that we should be putting public money into pushing up prices and that it would have no other effect. If the amount involved—as it would be—were only a few million pounds, a few million pounds of public money which serves no purpose but to increase prices is a few million pounds badly spent.
Of course, the proposal will not have a vast effect. Of course, there have been times of fluctuations in demand which


have resulted in the construction industry being unable to sell what it has already produced. The argument of ensuring stability of demand for the industry's product is going a little wide of the amendment—although not very wide, because it is directed to the effect of demand as a consequence of this change.

Mr. Stephen Ross: One other point occurs to me: that most new house building will be outside the range of the Bill. We are talking, therefore, about the cheaper houses in provincial and rural areas where this kind of demand does not exist and where the proposal would be very helpful.

Mr. Douglas-Mann: According to what we have been told, the relevant figures would be £12,300 in the South-East and £16,200 in London. That is for a young single purchaser who will be eligible for assistance under the Bill. A price of £16,000 can still be in the luxury class if it is paid for a very small flat.
6.45 p.m.
The hon. Member for the Isle of Wight (Mr. Ross) has drawn me rather wide. The point I wish to stress is that if the amendment were accepted we should certainly bring on our heads immediately the harm which I fear will come to a lesser extent when the Bil comes into full effect in two years. I hope that my hon. Friend will consider a selective subsidy for newly-built houses. Four-fifths of what we spend now on subsidising houses goes to push up prices, because four out of five transactions are for existing dwellings. If we concentrated on new houses, the argument in the Green Paper for persisting with the present expensive system would fall. I therefore welcome the idea in the amendment, although not the actual proposal involved.

Mr. Freeson: Having seen a new hon. Member for Hornsey (Mr. Rossi) in his remarks tonight, I was almost persuaded to go along with him. However, his recollection of my response in Committee has been clouded with warm good feeling towards me which does not reflect the mood in which I responded then.
I must repeat that the arguments I adduced against the original proposal in Committee are even stronger if the intention is to narrow this retrospective

application simply to new houses. That would reinforce the argument that we should be putting pressure on those prices when the market had not been prepared for the application of the Bill.
One theme brought out both in Committee and today is the need for the two-year period, apart from the administrative aspect, to allow the market to adjust to the increased demands that the injection of this assistance will place upon it. We judge that this period will provide sufficient time for adjustment. That is particularly apposite to the provision of new houses—even more than to the secondhand market. If one injected these resources immediately, the market would not have had time to adjust. The situation described by the hon. Member for the Isle of Wight (Mr. Ross) would be with us now as distinct from being with us in two years.
Despite what the hon. Member for Hornsey said, I believe that if we stick to the Bill as presently proposed, so far from there being a sudden surge of demand in two years without additional houses being available, the reverse will to some extent be true. In about two years, I suspect that there will be a slight hiccup as people wait in those two or three months for these benefits to accrue. In the summer and autumn of 1980, the first year of the operation of the scheme, there will be a slight holding back while people await the concluding period of the qualifying conditions.

Mr. Sainsbury: Would not the Minister agree that the market is much more likely to be affected, and demand adversely affected, by an upward movement in mortgage rates, which unhappily now seems likely, than by the changes brought about by the modest help in the Bill?

Mr. Freeson: There are all sorts of factors at play. If we want to proceed expeditiously with the Bill, I think that this is not the occasion to stray too widely, although one may be tempted to do so.
I am making the point that if we were to inject resources immediately, as proposed in the amendment, in respect of new houses when the market is not yet adjusted, we would exacerbate the problem of prices. Contrary to what has been suggested, in two years' time there will not be a sudden situation in which the


provision of these houses will cease. The market will have been able to adjust in the expectation of the benefits of the Bill beginning to flow. There will be a constant flow of people coming into the scheme, but in the first year there will be some holding back.
Let me give the House some background information. It has been suggested that it is important to take action now—not primarily to benefit the individual applicants in the first year, but as a one-off exercise to benefit the housing market. Let me make clear that the House-Builders Federation has not put the same point to me as it has obviously put to the hon. Member for Hornsey. The matter has not been put to me in those terms, but the federation has expressed general interest and has been warmly receptive to the Bill. In other words, that organisation would like to see more steps taken in this sphere.
The present position in the market is that, contrary to experience in the last few years, there is a steady increase in demand as well as in building activity. The last returns made by the house builders, as I recollect—I should have to check the precise figures—showed an expectation of 135,000 housing starts in the private sector in the current year. The house builders now expect a figure of about 160,000. Therefore, in a short period of time, there has been a marked increase, which reflects a feeling of confidence and an expectation of action in the building of new houses. It is the reverse of the situation that occurred two or three years ago when, following a great boom, there was a collapse in the market. That was caused by a number of factors, and one of the major factors was the mortgage famine of 1974. That collapse in mortgage facilities is no longer with us. We got away from that position after a year or 18 months.
Despite the restraint on mortgage flow which we negotiated with the Building Societies Association in early March, there will be a larger flow of mortgages in real terms in 1978 than in 1977. This goes against a certain amount of the mythology which has tended to creep in on mortgage flow. I do not expect to see the slightest sign of a mortgage famine. There has been close monitoring of the position in seeking to adjust matters as we think right in conjunction

with the Building Societies Association, but the problems which have been underlined as background factors in relation to the Bill do not arise in practice.
Let me now make a point about equity. Much has been said about the need to direct help to the older, cheaper properties in the inner city areas. We cannot at the same time select in an inequitable way certain provisions in respect of newly built houses. For these reasons, I hope that the hon. Gentleman will not press his amendment.

Amendment negatived.

Amendments made: No. 9, in page 2, line 38, leave out 'and (4),' and insert:
'(4) and (5), and the percentage figure in subsection (5).'.

No. 10, in page 2, line 38, leave out 'or'.

No. 11, in page 2, line 40, at end insert:
'(c) alter the second condition of subsection (3) so that purchasers can also satisfy it with lesser amounts of savings, and enable assistance under subsection (4)(a) and (b) then to be given according to reduced scales specified in the order.'.—[Mr. Freeson.]

Clause 2

ADMINISTRATION, ETC.

Mr. Freeson: I beg formally to move Amendment No. 12, in Clause 2, page 3, line 5, after 'consent', insert '(a)'.

Mr. Deputy Speaker (Sir Myer Galpern): With this we may take Government Amendment No. 13, and Amendment No. 17, in the Schedule, page 6, line 19, leave out:
'the Protection of Depositors Act 1963'
and insert:
'this Act'.

Mr. Durant: I wish to speak on Amendment No. 17, which concerns banks which might be permitted to enter into the scheme.
It has been put to me by the Shelter organisation that the list we were given by the Minister in Committee in relation to the Protection of Depositors Act 1963 included a number of banks. In that list I find, to my horror, the Julian S. Hodge Ltd. bank, which is not a bank that we would wish to include in the scheme. That bank has a bad history of pyramid selling, it has caused a great deal of anxiety


among a large number of immigrants, and I am concerned at its being involved in the Bill.
Amendment No. 17 seeks to make the situation clearer—namely, that the Minister should have more jurisdiction over which of the banks can be included. It seeks to cut down the list as provided in Committee. It seeks to delete from the approved list the name of Julian S. Hodge. I know that he is a friend of the Prime Minister, but this is not something that we would desire to see in the Bill and I am very anxious about the position.
The Minister assured us in Committee that that bank was not included. He then provided the list, and there was the name of that bank as large as life. The Shelter organisation has written to me expressing great concern and asking that this name be struck from the list because there has been so much bad experience with that bank in its pyramid selling and strong-arm stuff on repayments and a bad history in lending money on property. This occurred some time ago. I accept that it is not current practice, but we feel that it would be wiser not to have such a list associated with the Bill.

7.0 p.m.

Mr. Rossi: While the Minister was far too modest to extol the virtues of his own amendment and asked the House to take it for granted, I thank him for trying to meet some of the points that we raised in Committee concerning the Government's approach to the authorised institutions that will participate in this house purchase assistance scheme.
The right hon. Gentleman will recall that we strongly criticised the approach that there should be included in the schedule a list of lending institutions to which borrowers could go in order to obtain the loans and the tax-free bonus provided for in the Bill. The matter to which we took the greatest exception was the part of the schedule which enabled any banking company or discount company which is authorised for the purposes of the Protection of Depositors Act 1963 to be a participant institution in this scheme. As my hon. Friend the Member for Reading, North (Mr. Durant) has said, the Minister produced a list of

authorised institutions under the Act, and they are a very varied range indeed.
The comment that has to be made is that the Protection of Depositors Act 1963 is exactly what its title proclaims—an Act to protect depositors. One finds in the Long Title that it is
An Act to penalise fraudulent inducements to invest on deposit
in banks or discount companies, and also a measure to regulate the accounts of those companies and the advertising for deposits in them. In other words, the whole emphasis of the Act is to protect people lending money to the banks and institutions concerned.
In this Bill, however, the emphasis is quite different. What we are concerned with here is to help the borrowers, and that is an entirely different situation, because many of the banks in the list that the Minister gave us as authorised depositors are those which no doubt protect their depositors very well indeed, as they are required by the 1963 Act to do, and offer them highly attractive interest rates for the money deposited with them.
In the Bill, however, we are concerned with a poor section of the population seeking to buy houses with Government assistance up to a certain value, and they are the last kind of people who should find themselves involved in many of the companies whose names are listed as authorised under the 1963 Act, because they are companies which pay high interest to depositors and consequently charge even higher interest to borrowers.
Surely it is in the interests of those seeking assistance under the Bill to direct them away from that kind of lending institution. Therefore, in Committee we criticised the fact that the 1963 Act appeared listed in the schedule as it is, and our Amendment No. 17 now seeks to leave out from the schedule any reference to the Protection of Depositors Act.
If we did that, we would be left with the simple proposition that the companies which would be authorised institutions for the purpose of lending money to people seeking Government assistance would be those which satisfied the Secretary of State that they ought to be treated as a banking or discount company. One would have thought that the Secretary of State, in exercising his discretion under that kind of provision, would wish to


satisfy himself that people were not going to be asked to deal with banking institutions or bank houses which by the nature of their business charge more than the prevailing rates of interest.
The Minister is seeking by his amendment to meet the objections that we raised in Committee, but he is doing it in an inverse fashion. He is saying, in effect, "Let the list under the Protection of Depositors Act 1963 remain as it is; prima facie, all these organisations can participate under the scheme. Let them go ahead and lend money at whatever rates they do their business, but if the Secretary of State finds that some of the circumstances are not those which satisfy him he will bring himself to take action and remove those banks or discount houses from the approved list."
I would prefer the right hon. Gentleman to look at it in another way, do a bit of work to start with and begin examining now the banks that should be included in the scheme. There is an abundance of evidence that he can obtain from the City and other major financial sources about what the attitude is and what kind of business these institutions carry out. He can start by drawing up his list of those which are approved, and not at some later, unspecified date draw up a list of those disapproved. Although I thank the right hon. Gentleman for trying to meet some of the objections we have raised—I appreciate the spirit in which he has tabled the amendments—we feel that his approach is not quite the right one.

Mr. Freeson: This short debate and the one we had in Committee have been very useful. Many of the points made on both sides in the debates have validity. We indicated in Committee that we would consider the matter further. I remain convinced that the definition of "bank" that we propose in paragraph 6 of the schedule is sound and useful and will save a great deal of new work.
I do not mind being exhorted by the hon. Member for Hornsey (Mr. Rossi) to do more work in connection with the operation of the Bill. I am not short of work, and we will do it when necessary. But I do not think that I necessarily wish to effect duplication of effort in this respect. There is ample opportunity in the Government to establish the experience

elsewhere in other Departments—as is the case here—which can be used for our own pursposes in connection with the Bill. It is certainly not my wish, and I hope that it will not be the hon. Gentleman's, simply to create unnecessary new work in a life that is well pressed for time and effort already. I hope that the hon. Gentleman will appreciate and accept that his proposal would mean a repetition of much work already done.
The definition in the schedule relates to banks which have satisfied the Secretary of State that they should be treated as discount or banking companies for the purposes of the Protection of Depositors Act 1963. This provides, without further additional and separate work on our part, an assurance of financial repute. That being said, I accept the objective of Amendment No. 17. I appreciate the concern felt by hon. Members about the need to be able to include further banks of particular interest to ethnic minorities and perhaps the need to be able to exclude some banks whose behaviour in relation to the scheme proves not to be of the high standard that we will demand. I shall explain why I prefer my approach to the problem.
Clause 2(1) already provides the Secretary of State with power to add further institutions to the schedule. We propose to use this power to include any reputable banks, whether ethnic or not, which apply and which satisfy the Treasury, the Bank of England and the Secretary of State as to their suitability for inclusion.
In order, however, to cope with the possible need for exclusion of an institution in the schedule, I have tabled Amendment No. 13, which is designed to give the Secretary of State power to remove institutions from the list. Thus, if the need arose, whether because an institution had ceased business, wished to stop participating in the scheme or had seriously abused its position in the scheme, the Secretary of State would be able to delete that institution from the list of recognised bodies. The amendment provides that before any order was made an institution would have an opportunity to make representations to the Secretary of State.
That summarises the position. I believe that we have met both points that were raised in Committee and which have been repeated briefly today. I think that there may have been misunderstanding in some


quarters, arising from the preparatory work on the Bill, as to whether we were including certain banks in some parts of the country which could validly be so included. I believe that my hon. Friend the Under-Secretary reassured the Committee that that was not the position, and I hope I have reinforced the assurance which he gave at that time that when further information on other institutions comes before us we shall consider it and add to the list. That is the first point.
The second point is that I believe that the procedure we have tabled in our amendment will meet the concern that hon. Members have rightly raised about the continued inclusion in the list of banks which have not been operating in the way that is appropriate for them in connection with the scheme.

Mr. J. Enoch Powell: The right hon. Gentleman used the expression "ethnic bank". Would he define the meaning of that term?

Mr. Freeson: It is a term which was used during the course of the Committee proceedings. I accept what I think is the implied concern or query in the right hon. Gentleman's mind. I have queried the rather loose usage of the word, but I must confess that I am slipping into the same trap. It is a bank which represents, in a proper fashion, a financial interest created by people within particular communities. There are certain banks which derive their resources and their organisation from certain Asian communities. I believe that there have been attempts within the West Indian community to act similarly, as, indeed, within other groups. If I may say so, I have operating in Kilburn, within my on constituency, as have other hon. Members in their constituencies, the very well established Allied Irish Bank, which has been there for some years. I suppose that that would also come within the category of ethnic banks that we have within the country.

Amendment agreed to.

Amendment made: No. 13, in page 3, line 5, at end insert—
'(b) by order made in the case of a body named in it direct (but only after giving an opportunity for representations to be made on the body's behalf) that it be no longer a recognised institution'.—[Mr. Freeson.]

7.15 p.m.

Mr. Michael Morris: I beg to move Amendment No. 14 in page 3, line 11, at end insert—
2(a) The Secretary of State shall at any time prior to the Secretary of State making an order under Section 6(2) of this Act make an order specifying the considerations by reference to which a person is or is not to be treated as a first time buyer of house property.".

Mr. Deputy Speaker: With this we may take the following amendments:
No. 15, in page 3, leave out lines 19 to 21.
No. 16, in page 4, line 12, after "(6)" insert "and 2(2)(a)".

Mr. Morris: Clause 2 is essentially to do with the administration of the Bill, and the amendment seeks to go to the very heart of the scheme, in other words, the definition of a first-time buyer.
We recognise that there are all sorts of elements in the running of the scheme in regard to which it will be necessary for the Secretary of State to make variations from time to time, and to do it by way of an order. But when we consider that the primary purpose of the Bill is to help first-time buyers, we believe that there is a case to be made out that the Secretary of State should seek the approval of Parliament for what he, at that point of time, seeks to define as a first-time buyer.
We are not suggesting that the Secretary of State is in any way unable to arrive at a satisfactory definition, but the more we look at the Bill, the more concerned we are—the hon. Member for Isle of Wight (Mr. Ross) referred to this earlier—that there are distinctive groups which may or may not qualify under the Bill. In the case of the first-time buyer, it would be appropriate that Parliament should have the opportunity to comment on the definition of those whom the Government of the day sought to benefit by the Bill.
The general consensus in Committee was that it would not be applicable to pensioners, although an argument could be put forward in regard to pensioners who are housed in public housing and who seek to leave an inner city or inner urban area in order to move, for example to the seaside, as many do, and thereby to go into private housing, becoming first-time buyers. That would be to the total


benefit of the community in terms of resources, and it might be thought that they should be encouraged in that respect.
But more important is the single-parent family. I admit that this may not happen initially, but one can envisage a situation in which a couple have had the benefit of the scheme, and there is then a divorce, or perhaps widowhood. As a result, the single parent may again wish to take part in the scheme and become an owner, in his or her own right, as a single parent. I do not know whether the right hon. Gentleman envisages that that situation will be covered. I must confess that I have not raised it with the right hon. Gentleman before, and it is perhaps a slightly unfair ball to bowl at this stage.
The fundamental point is that the House wishes the Bill a fair passage, but in the final analysis the House has the right to ask that the Secretary of State of the day should propose the definition and that the House as a whole should approve it.

Mr. Freeson: This is an important point, and therefore I want to deal with it carefully, even though we went over the ground to some extent in Committee and I have again had a discussion with the hon. Member for Hove (Mr. Sainsbury) on the matter between the completion of the Committee stage and today's proceedings.
We originally considered, and have considered further at some length, the question of which matters should be in the Bill, which in orders, and which in directions. Important matters, such as the framework of the scheme, are in the Bill. Major changes to that framework, such as altering the amounts of the assistance, are matters for Parliament and will be contained in orders. More minor matters, too important to leave to the discretion of the institutions involved but not of sufficient importance to justify detailed oversight by Parliament, we propose to specify in directions.
My firm view is that to use orders would involve Parliament in overseeing detailed matters of administration. For the future, the Government need the ability to use directions to respond flexibly and rapidly to changing circumstances and problems. I believe that

Opposition Members, by restricting their amendment to this one, recognised the force of these arguments generally, although they are making a particular point in the amendment. I have tabled my own amendment, dealt with earlier, on the minimum loan provision.
I believe that I have the right balance, and that the intention of the amendment, which seeks to define the first-time purchaser by order, tips the balance the wrong way. I ask the House to reject it.
There are two main objections. First, it would be wrong in principle for the definition to be dealt with in the manner proposed. The expression "first-time purchaser" practicaly defines itself. The Secretary of State has little discretion in the matter.
Secondly, the amendment could delay the introduction of the scheme for at least six weeks, since the institutions could not be expected to embark upon printing expensive leaflets explaining the scheme, training staff and programming their computers, until the details of the scheme are certain. The order would mean waiting for the expiry of the 40-day period. I am sure that that is not what hon. Members would want, but that would be the effect of the amendment. It would delay the introduction of the scheme.
Perhaps if I explain what our broad consideration will be in this matter when preparing directions, hon. Members will be reassured. The Secretary of State's power under subsection (3)(c) will be used to lay down a simple test to be applied by the lending institutions to decide borderline cases. One of them has been mentioned already and I shall mention some others in a moment.
The test that we have in mind is to treat all purchasers of the freehold or a long lease—which means a lease of more than 21 years—of house property as first-time purchasers unless they have previously owned such an interest in their home. This is the test in England and Wales. In Scotland the Scottish equivalent would apply. The test would effectively exclude all those who were previously owner-occupiers within the normal meaning of that term. All those who had not previously been owner-occupiers would be first-time purchasers, including, for example, those living with their parents or in lodgings, or who were tenants under short leases. The Secretary


of State's power cannot be used to direct that those making a second or subsequent purchase should be treated as first-time purchasers. Nor can it exclude those buying who had not previously owned property. This is basic. There is no question of a discretion being applicable in such circumstances.
It is as simple as that. But by confining the definition to directions—which can be amended flexibly and swiftly—we leave ourselves able to react to changes at the margin, and can give help to institutions with doubtful cases. But if this amendment is accepted we shall need to come to Parliament on incredibly detailed points, with all the delay and inflexibility that is entailed.
I have, of course, promised to make the directions publicly available, and copies will be placed in the Library. I hope that hon. Members will agree that this is an issue to which the Government have given great thought and have reached the most appropriate conclusion.
I did say that I would give a brief indication of the kind of borderline headings, such as those mentioned by the hon. Member for Northampton, South (Mr. Morris), which have come to mind during our considerations so far. There is the question, which I think was mentioned in Committee, of tied accommodation. The classic example is that of the retiring Church minister who wants to prepare the way for retirement but who would obviously not be expected to occupy his accommodation straight away. He will still be in his existing tied accommodation. We would like to use our discretion to define for the institution, for the purpose of the Bill, such a person in that situation.
Another category consists of separated persons. They would be eligible if permanently separated and if he or she had not previously bought in his or her own, or joint, names. With regard to joint purchasers, each must be a first-time purchaser. This follows from the nature of the assistance. A kind of new social dimension is appearing in some of our urban areas as to the nature of household and joint purchase to which we must be prepared to adjust but which we cannot define closely at this stage. Then there are self-build societies, which also provide a

variety of action in this area and which we should like to see included.
These are just examples of the kinds of cases that have already been in our minds. Others about which we cannot be clearly aware at this stage, may well emerge. The main points that I wished to make were my earlier ones. I hope that I have made clear that which cannot be the subject of discretion. I therefore hope that the House will accept what we are putting forward.

Mr. Sainsbury: Can the Minister say whether those who are part of a co-operative housing movement would be disqualified as having previously owned property? Can he also say anything, either now or by writing to me, about the community leasehold scheme which is equivalent to half-and-half ownership?

Mr. Freeson: I spent a good deal of time discussing these matters before we brought the Bill to the House. The position on co-ownership schemes—co-operative schemes—is that some schemes involve individual mortgages and others do not. People who have collective mortgages would not qualify for benefits under this Bill because they are not individual owners of the mortgage. But other co-owner-ship schemes—more generally referred to as community leasehold schemes—where individual mortgages are taken out on a long-lease basis, would qualify. Similarly, those participating in shared equity schemes would qualify to the extent that they have part of the equity.
In other words, the benefit of the scheme would apply to co-operative, co-ownership or shared equity schemes where individual mortgages were involved. Where there is a participation in a collective mortgage, which rests with the corporate body, the individual members of that body would not qualify. However, they would qualify the moment they left such a co-ownership or co-operative and participated in a different kind of co-ownership involving individual mortgage or went into conventional owner-occupation. I hope that that satisfactorily clears up the matter.

Mr. Michael Morris: One is always reluctant to consent to dismember Parliament's control over what is a fundamental fact and key point in this scheme. Since we first raised this point, the Minister has gone a long way and has made clear that


there is to be considerable openness and publicity with regard to those who qualify.
I ask the Minister to think about the situation of the widow who, having previously been a joint owner, marries for a second time, this time to someone who has not been an owner. I hope that that will not preclude the new family from benefiting from the scheme. These are flexible details, which I know the right hon. Gentleman wants to look at. Given that consideration, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 3

BUILDING SOCIETY LAW

Mr. Armstrong: I beg to move Amendment No. 21, in page 4, line 36, leave out:
'by the Secretary of State'.
This is a technical amendment. Under Section 41 of the Building Societies Act 1962, a building society acknowledging receipt of an advance has to incorporate certain provisions of the Act in that acknowledgment. Clause 3(4) disapplies Section 41 in cases where a building society makes an acknowledgment to the Secretary of State of an advance under this scheme. In Northern Ireland, however, such an acknowledgment would be made to the Department of the Environment for Northern Ireland, and the disapplication would be ineffective. The purpose of this amendment is therefore to extend the disapplication of Section 41 of the Building Societies Act to cover acknowledgments made by British building societies operating in Northern Ireland. It is achieved simply by removing the phrase
by the Secretary of State".

Amendment agreed to.

Clause 4

NORTHERN IRELAND

Mr. Powell: I beg to move Amendment No. 18, in page 4, line 37, leave out subsection (1).

Mr. Deputy Speaker: With this we may take the following amendments:

No. 22, in Clause 6, page 5, line 28, leave out from second 'Act' to 'but' in line 29, and No. 23, in page 5, line 29, leave out 'subject to' and insert 'except for'.

Mr. Powell: The two amendments which you, Mr. Deputy Speaker, mentioned are as consequential as the assistance of the Public Bill Office can make them. It would be an understatement to describe these amendments, in the time-honoured phrase, as probing amendments.
This clause applies, or extends, the Bill to Northern Ireland. My hon. Friends and I desire to see the provisions of the Bill extended to Northern Ireland, as, indeed, we desire to see United Kingdom legislation generally embrace Northern Ireland within its scope. But the form of Clause 4 is, I believe, novel and raises questions of constitutional importance. This Report stage is perhaps the appropriate time to record matters which are of interest not only to Northern Ireland, although they especially affect Northern Ireland, but also to the House as a whole, concerned, as it is, with the quality and propriety of the legislation which we pass.
There has been correspondence, extending over the last month, between the Under-Secretary of State—whom I am grateful to see in his place to deal with this amendment—and myself. I acknowledge the great care and detail of that correspondence. Not all the correspondence which emanates from Government offices is of the highest quality; but certainly that which comes from the Northern Ireland Office dealing with legislative and constitutional matters of this kind is of high competence. In fact, our exchange of letters on the subject during the last month might, if published, form a nice little State paper.
7.30 p.m.
I hasten to put you, Mr. Deputy Speaker, out of any anxiety that I might be about to attempt to read that correspondence into the record, though I shall quote one or two sentences from it.

Mr. Deputy Speaker: Order. I always enjoy the elecution of the right hon. Member for Down, South (Mr. Powell).

Mr. Powell: I am grateful to you, Mr. Deputy Speaker. Unworthy as I am of


that compliment, I appreciate that enjoyment is tempered by quantity and proportion and that if my remarks are in moderation the enjoyment which you derive from them may be all the greater for that. I shall endeavour to make the difficult constitutional points which I have to make as briefly as possible.
The House will be aware that in effect since 1972, with a brief interlude, there has been power on the part of the Secretary of State for Northern Ireland to legislate in Northern Ireland—albeit a part of the United Kingdom—by Order in Council. This is naturally a feature which has been unpopular in Northern Ireland, and has attracted such descriptions as "colonial rule". Experience of it has not led those of us who represent Northern Ireland constituencies to conclude that there can be any proper substitute for legislation by Bill. If legislation could have been adequately and properly enacted by Order in Council, the House of Commons and successive Governments would have discovered it long ago. However, we acknowledge that this is a transitional—though it may be a long transitional—phase and that much of the legislation for Northern Ireland for some time to come may need to be by Order in Council under the Northern Ireland Act 1974, which will fall to be renewed in a few weeks.
There are severe deficiencies in such a procedure. It means that hon. Members, not only those representing Northern Ireland, cannot bring their influence to bear at successive stages of the formulation of legislation as they can do in the course of procedure by Bill. We acknowledge that the Government, in a series of new procedures, have modified as far as may be humanly possible the stringency of legislation by Order in Council, and we make use of those procedures to the full. But there remain grave deficiencies which are inherent in legislation by Order in Council.
There are three classes of case in which that form of legislation may be used for Northern Ireland—though it does not have to be used. One is the application to Northern Ireland of law which already exists in Great Britain. A good many of the Orders in Council which will be appearing before the House in the next few weeks—perhaps at a later hour than

this—are doing exactly that. They are extending—many of us would say belatedly—to Northern Ireland measures which the House has passed applying to Great Britain. That is perhaps the most natural sphere in which in present circumstances it is legitimate and unavoidable to use the procedure by Order in Council.
The second sphere is where new legislation is made which applies only to Northern Ireland. In that sphere there are cases—I refer, for example, to the Fair Employment (Northern Ireland) Act 1976—in which procedure by Bill has been found to be appropriate; and my hon. Friends and I would say that whenever possible, where new legislation is being made, even though applying only to Northern Ireland, it would be most proper and effective to carry it through Parliament by Bill. We have more than once indicated that in sum the time that would be required by the House and by hon. Members might well be not longer by that method than by Order in Council.
The third sphere is that with which we are concerned in this application clause. It is where new Great Britain law is to be applied, virtually as it will stand, to Northern Ireland. Here I come to the substance of the matter—the question by what method legislation which in the view of the Government and the House is to apply virtually without differentiation to the United Kingdom as a whole ought to be extended to Northern Ireland. One method—the obvious one—is that there should be a United Kingdom Bill which applies to the whole of the United Kingdom. There are many examples of that, from the Fishery Limits Act 1976 to the annual Finance Bills, which of course apply to Northern Ireland with little or no specific application to that Province.
Sometimes, however, United Kingdom Bills need to be extended, as to Scotland so to Northern Ireland, by application clauses. There is an example of this at the moment going through its stages in the House, namely, the Deer Bill, promoted by the hon. Member for Harborough (Mr. Farr), which contains a Northern Ireland application clause.
It is true that that Northern Ireland application clause, which was drafted by skilful and, I would suspect, Ulster draftsmen, occupies a page and a half of a Bill of 14 pages. But, then, we cannot judge the time of the House by the quantity of


lines or pages of a Bill. I think it would be generally admitted that application clauses of this kind in United Kingdom Bills, though they receive the scrutiny of Members coming from the particular part of the kingdom, go through with very little difficulty and add very little to the legislative burden of the House. The strong preference of my hon. Friends and myself, wherever possible, is for United Kingdom Bills with an application clause of that kind extending them to Northern Ireland as they stand.
I acknowledge and put on record with gratitude the explicit assertion of the Under-Secretary of State on behalf of the Government in the letter which he wrote to me dated only today. He is referring to the Deer Bill, which I have quoted, and he says:
In this Bill and in a number of Acts primary legislation is extended to Northern Ireland without the use of Orders in Council. We shall continue to use this method whenever it appears to be practicable and desirable.
That is a gratifying statement of policy for hon. Members on this Bench, and we do not doubt but that it will be applied in the spirit as well as in the letter by the Government as new United Kingdom legislation comes forward. In other words, wherever there is to be new United Kingdom legislation, the question will be asked whether it can be extended to Northern Ireland by an application clause appearing upon the face of it; and the onus of proof will be on those who would argue that it cannot be so extended.
However, the Government maintain—this brings me to the clause to which the amendments relate—that in some cases the application of United Kingdom legislation to Northern Ireland would be so cumbrous or complicated that it could not be brought conveniently within the scope of one or more application clauses. While one would take that assertion on trust, I must say that it has not been easy for my right hon. and hon. Friends and myself to see quite what these immense complications can be which would defeat the attempts of the draftsman to draw up two, or three if need be, application clauses for insertion in a United Kingdom Bill.
Nevertheless, I am prepared to accept the statement of the Minister that there are cases where application clauses in a United Kingdom Bill itself would be intolerably

and unacceptably clumsy. That being so, the question arises how those Bills should be applied.
One method would be to pass the Bills as Great Britain Bills and then bring in an Order in Council under the 1974 Act re-enacting them, as it were, for Northern Ireland. There have been many examples of that. My right hon. and hon. Friends and I do not regard it as the method of choice and we are grateful to the Government for having attempted to find some means of avoiding that procedure, of which the vice is that hon. Members representing Northern Ireland constituencies are, as it were, strangers in this Chamber while the Great Britain Bill is going forward—it is not natural for us to take part in the Second Reading debate, and we would not normally be put on to the Committee—yet when that Bill is put on the statute book it becomes a virtually unchangeable model for the application to Northern Ireland of new legislation which we have not had the opportunity to debate either in principle or in detail.
Therefore, the Government have sought to insert into a United Kingdom Bill a clause—that is, Clause 4, which by virtue of these amendments we are able to discuss—which shows upon the face of the Bill that it will be applied to Northern Ireland virtually without change but enables that application to be made by Order in Council.
So far, so good. We acknowledge that that is a great improvement upon separate re-enactment for Northern Ireland by separate Order in Council. We accept that this method gives us the advantage that we are, so to speak, enfranchised from the First Reading of the Bill. The Bill is to be just as much Northern Ireland legislation as Great Britain legislation and it will be our own fault if we do not choose to attend to it at all its stages from Second Reading onwards. That is the good side of the clause before the House; but there is attached to it a difficulty which is both technical and constitutional.
You will see, Mr. Deputy Speaker, as you study the clause, that its effect is to amend, ad hoc, the Northern Ireland Act 1974 so as to provide that Orders in Council made under this enabling clause shall be subject not to the affirmative procedure but only to the negative procedure. I would agree, and so


would my right hon. and hon. Friends, if there is an order which is simply implementing for Northern Ireland, without effective change, legislation which this House has passed in the knowledge that it was to apply to Northern Ireland and with full opportunity for Northern Ireland Members to take part in the proceedings, that in most cases the negative procedure would be appropriate for that subordinate legislation. We would concede that. We do not quarrel with the proposition of the Government that, if we are making a carbon copy for Northern Ireland, there is no need for the carbon copy to go through the affirmative procedure.
7.45 p.m.
Our difficulty is that the Order in Council procedure, the emergency procedure whereby law can be made by a Secretary of State for a part of the United Kingdom, does at any rate carry the safeguard, never hitherto breached, that everything done under that power must come to this House, because an affirmative procedure is required. So at least we have the safeguard under those temporary provisions that we are legislated for, however cursorily, by both Houses of Parliament. Hence our dilemma: while we concede that, in the circumstances of making a carbon copy, the negative procedure would be fully appropriate, we are extremely reluctant to concede that the safeguards of the 1974 Act should be eroded. One case may follow another; and there are no fewer than three Bills at various stages at the moment which contain this clause eroding that safeguard in the 1974 Act.
The Government have not so far been able to find a solution to this dilemma. We have put forward to them the suggestion that, if they think the application so complicated that it cannot be done in a Bill, they should do it by Statutory Instrument—not by Statutory Instrument under the 1974 Act, thus involving the erosion of the protection, but by Statutory Instrument under the Bill itself. That is the proposition which we have urged upon the Government. They have found so far that there are two difficulties.
I will read the relevant sentences from the letters written by the Under-Secretary. He first says that such subordinate legislation could not

without appropriate provision being made … amend existing Northern Ireland legislation, nor could it authorise the making of subordinate legislation.
Again, in his letter of today's date the Under-Secretary said that Orders in Council provided a method of legislation which "had the attributes of primary legislation".
This is a matter which I believe needs to be carried forward, and I am sure that with the good will of the Northern Ireland Office it can be carried forward, in further study; for it is a paradoxical statement to say that this House cannot enact a Bill under which Statutory Instruments can be made which make provision for subordinate legislation—there are plenty of those—or which make provision for legislation which is of primary character. There does not seem to us to be anything peculiar to the situation of Northern Ireland which renders it impossible for a Statutory Instrument made under a United Kingdom Bill to be the vehicle for carbon-copying the Bill in terms applicable to Northern Ireland.
That is the crux which, for us, lies at the heart of this new device in its present form. We are reassured by the undertaking which the Government have given in these terms from the Under-Secretary. He writes:
if you think that it would help for Northern Ireland Members of Parliament to be consulted before a Bill using this procedure"—
that is, the procedure of Clause 4—
is introduced, we will do our best to arrange this.
We are most grateful for that offer and would be glad to be taken into consultation at whatever stage is convenient to the Government where it is felt that a clause of this nature is the most appropriate method of application; but we would like to continue the search for a more convenient method of application to Northern Ireland and one which does not involve the very real constitutional problem of whittling away ad hoc, Bill by Bill, the fundamental safeguard which was provided in 1974 by the Northern Ireland Act.
Undoubtedly, this clause marks a progress for Northern Ireland. It marks progress away from the rigid position first introduced in 1972 towards the position to which we aspire, when legislation for that part of the kingdom will


be like legislation for any other part of the kingdom, taking account of its circustances and the differences of its earlier law but nevertheless going through the House and being made by Parliament in the normal way. We recognise that the havoc which was done in 1972—I am glad to think that I was in my place to vote against it—will not be easily undone. The difficulties that we are facing this afternoon arise from the fact that what was done in 1972 was done without thought and without regard to the consequences. As often happens, those consequences, easily incurred, have to be put right painfully and over a long period of time.
However, we are making progress in this Bill and in other Bills which contain this clause, and we believe that we have to go further in the same direction, and that in doing so we have the good will of the Government, as well as the collaboration of the Under-Secretary and his colleagues. That is why we thought that it would be wrong for a matter of such substantial constitutional importance to pass without being noted on the Floor of the House, or without the implications of it being placed briefly upon the record.

The Under-Secretary of State for Northern Ireland (Mr. Ray Carter): In moving the amendment the right hon. Member for Down, South (Mr. Powell) raises a question of the means of legislating for Northern Ireland during direct rule. It is therefore appropriate for me to reply.
I shall explain first why the Government have chosen to apply the provisions of this Bill to Northern Ireland by the procedure set out in Clause 4. Northern Ireland legislation is normally made by an Order in Council under the Northern Ireland Act 1974, subject to affirmative resolution in this House. This method is not ideal. But until Northern Ireland again has a devolved Assembly it will normally be the only practicable method of enacting primary legislation for Northern Ireland, and this was recognised by Parliament when the Northern Ireland Act was approved in 1974.
At times these Orders in Council have reproduced provisions already in force in Great Britain, the only difference being technical amendments to take account of differences between existing Northern

Ireland and Great Britain legislation and of different legislative conventions. In circumstances such as these in future, we hope to use a different procedure. When we can foresee that the provisions to be applied to Northern Ireland will strictly correspond to those being applied by Bill to Great Britain, with the need only for technical adaptation, we will do what we are doing in Clause 4.
We will show on the face of the Bill that the provisions will apply to Northern Ireland, thus facilitating the participation of Northern Ireland Members in the debate on the provisions at the same time and in the same way as those representing Great Britain constituencies, and we shall enable those provisions to be applied to Northern Ireland in the normal way that primary legislation is enacted for Northern Ireland by way of Order in Council under the Northern Ireland Act 1974. However since the provisions will have been fully approved during the Bill's passage, only negative procedure will be required for the Order in Council rather than the usual affirmative procedure.
I understand that the right hon. Member for Down, South and his colleagues do not object to the provisions of this Bill being applied to Northern Ireland by Order in Council. Nor do they object to these Orders in Council being subject to negative procedure as such when, as in this case, they can contain only those provisions which correspond to those in a Bill which has declared that its provisions will be applied to Northern Ireland. There is therefore a good deal of common ground between us.
What the right hon. Member objects to is the fact that this result is achieved by reference to the provisions of the Northern Ireland Act 1974. He argues that the constitutional safeguards contained in that Act are weakened by allowing an Order in Council in this one case to be made subject to negative procedure, when the Act normally demands affimative procedure. He believes that it would be preferable for the Order in Council to be made under the authority of this home purchase Bill. He sees this issue as one of constitutional significance.
There is good reason why the Government chose to draft the clause in the way they did. The Order in Council, applying the provisions of the home purchase Bill to Northern Ireland, must have some


of the attributes normally reserved for primary legislation. It must authorise the making of subordinate legislation and must amend existing legislation. It is true that the home purchase Bill could be drafted in such a way as to give an Order in Council made under it all the necessary attributes. But the resulting clauses would greatly lengthen and complicate the Bill. It is far simpler for the Order in Council to be made under the Northern Ireland Act 1974, which is the normal way of enacting primary legislation for Northern Ireland. All Orders in Council under this Act have the force and effect of primary legislation. Our method is a far more economical way of achieving the desired result than that proposed by the right hon. Member.
Nor do I accept that constitutional safeguards are weakened. Only one Order in Council under the Northern Ireland Act, subject to negative procedure, can be made as a result of this home purchase Bill, and that must correspond strictly to the Bill. By approving Clause 4 unamended, this House will not be reducing any constitutional safeguards. It will simply be saying, in effect, that it has approved the provisions of this Bill for Great Britain, and there is no reason for a further debate before corresponding provisions are applied to Northern Ireland.

Mr. Powell: I make no complaint that the Under-Secretary has restated briefly and clearly the Government's position. I would only say that since our objectives considerably overlap there is every reason why our search for even more convincing methods should continue. Since the purpose of this amendment was to record the point that has been reached, I would say, in the famous words of the BBC, "The debate continues." I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Motion made, and Question proposed, That the Bill be now read the Third time.

7.58 p.m.

Mr. Douglas-Mann: As I gave a qualified welcome to the Bill on Second Reading, and as I have come to the conclusion, during the course of the Committee stage, that it is a Bill that we shall regret, it is right for me to make a brief statement indicating my reasons for reaching that conclusion.
The measures provides for the expenditure of £100 million of public money each year—certainly for the first five years of its operation. That £100 million will come from other housing expenditure—from money which could be applied more directly to relieve housing need. It could be used for improvement, for municipalisation, for new housing construction, or for local authority lending. It means that there will be £100 million less for other sections of the housing programme. We must ask ourselves whether it is £100 million that will be spent effectively and desirably.
I accept that there will be some benefits from the Bill, but I fear that the damage that it will do will outweigh the benefits. It must be borne in mind that only one of every five first-time purchasers is buying a new house. That means that four-fifths of the money must necessarily go to increase the capacity of those who are buying existing houses to pay more for them. That is an inevitable and inexorable consequence of the additional demand that the Bill must generate.
As the Minister acknowledged, only about 40 per cent. of the beneficiaries under the Bill would not have been able to buy anyway. Consequently, 60 per cent. of the beneficiaries will be those who would have purchased anyway. Inevitably, a substantially greater part of the money that is to be spent will go towards the inflation of house prices.
I accept that there will be some benefit. There will be some who would not have been able to buy who will be helped into house purchase as a consequence of the Bill. There will be some stimulus of demand for new houses. However, the principal cause of an increase in the price of property must be the generation of additional demand, and additional demand must come primarily from new house purchasers coming into the market.
I fear that the benefits that are likely to arise from the Bill will be much less than the disadvantages. I should welcome the Bill if we had been able to amend it to ensure that it would operate in a more discriminatory fashion at the bottom end of the market. I appreciate that there were administrative difficulties in our so amending it. However, I do not believe that they would have been in any way insuperable. As a consequence of the Bill's being unamended,


we have a measure that is bound to result in some stimulus and an addition of about £60 million a year to the price of houses. For that reason I feel that the Bill is one that we shall view with regret.
I would take that view to an even greater extent should it come about that the Conservative Party was ever in a position to exercise the powers within the Bill. The hon. Member for Hornsey (Mr. Rossi) indicated in Committee that he relishes the powers that would be given to a Conservative housing Minister. If we are to have one, I would rather it was the hon. Gentleman, but I fear that even he would prove incapable of withstanding the pressures that would be exerted upon him by his leader to abuse the powers that exist under Clause 1(6). By means of that subsection he could alter any of the sums specified. He could substitute longer or shorter periods and generally relax the conditions.
I fear that it would be the intention of a Conservative housing Minister to turn the Bill, which, as we have said, is a small Bill, into a major measure merely by order, without Parliament having the opportunity of debating the desirability of generating even further demand, which it would be his intention of doing. For reasons that the hon. Member for Hornsey knows and understands very well, that would almost certainly prove even more disastrous.
We have seen the Conservative Party making irresponsible promises and suggestions on housing issues before, and we are aware of the harm that would be caused if Conservatives were in a position to exercise the powers that the Bill would give them. We shall be giving them additional powers if we enact the Bill and they come to office. At the same time, we shall be reducing the power of Parliament to prevent that harm. For all those reasons I think that the Bill, although conceived with the best of intentions, will do a small amount of good but is likely to do a greater amount of harm. I regret that we are now passing it into law.

Question put and agreed to.

Bill accordingly read the Third time and passed.

Orders of the Day — EUROPEAN COMMUNITIES (TREATIES)

8.5 p.m.

The Minister of State, Foreign and Commonwealth Office (Mr. Frank Judd): I beg to move,
That the draft European Communities (Definition of Treaties) (No. 4) Order 1978, which was laid before this House on 11th May, be approved.
The schedule to the order contains the act concerning the election of representatives of the European Assembly by direct universal suffrage, taken with the decision of the Council of the European Communities of 20th September 1976 to which it is annexed. The text of the act and decision, in the form of Command Paper No. 6623, was laid before Parliament in October 1976.
If the House approves the order, the act and the decision to which it is annexed will become formally defined as a Community treaty under Section 1 of the European Communities Act. The European Communities Act gives effect to all the rights, powers, liabilities, obligations and restrictions embodied within a Community treaty. However, only Community treaties formally defined as such, under Section 1(3) of that Act, have direct effect in the United Kingdom. Without the approval of both Houses of Parliament to the act and decision listed in the schedule to the order, they would create rights and obligations at the international level, but could not, for instance, be invoked by individuals before the courts of this country.
The act has the character of an international agreement. Article 16 of the act requires that it enters into force only after notification by member States of the completion of their respective constitutional requirements for adoption of its provisions. In Britain, constitutional practice has required that we first enact the European Assembly Elections Bill, which received Royal Assent on 5th May, and then also secure Parliament's approval to the specification of the act and the Council decision of 20th September 1976, to which it is annexed as a Community treaty, before we proceed to ratification. This approval we now seek.
With your permission, Mr. Deputy Speaker, and that of the House, I shall describe briefly the contents of the act


and the decision of 20th September 1976. The decision consists—

Mr. Neil Marten: On a point of order, Mr. Deputy Speaker. I have just been to the Vote Office to get the very document about which the Minister is speaking. The Vote Office does not have it. It is not in stock. How can we possibly debate this matter if the document is not in stock?

Mr. Judd: With respect, that is a matter not for me but for the authorities of the House. However, I point out that the document has been available. A memorandum has been available now for some days and has been before the appropriate Committees.

Mr. Douglas Jay: Further to that point of order, Mr. Deputy Speaker. Surely this is a matter for my hon. Friend the Minister, because we are being asked to give legal effect to this so-called act. It is only with great difficulty—it has taken me several days to do so—that I have been able to secure the document from the Vote Office. As no hon. Member today can readily secure it, is it not part of the duty of the Government and my hon. Friend to ensure that the main document that we are discussing is available to all hon. Members?

Mr. Deputy Speaker (Sir Myer Galpern): There is no doubt that a ruling was given in 1966 by Mr. Speaker that it was the duty of a Department to provide the list of documents relevant to the debate. May I take it that that has been done?

Mr. Judd: As I reminded the House in my opening remarks, the text of the act and decision in the form of Command Paper No. 6623, was laid before Parliament in October 1976. Therefore, it is a fact that the documents to which we are referring have been available to Parliament for a long time.

Mr. Nigel Spearing: I am sorry to interrupt my hon. Friend the Minister of State. Although he may be right that at some time the treaty, which was, I believe, negotiated by the late Mr. Anthony Crosland, was available to the House, we are told—I understand that it is so—that it is not available to the House tonight. My hon. Friend and

you, Mr. Deputy Speaker, have used the phrase "relevant to the debate". I submit that, rather than being relevant to the debate, it is central to it. The order that is before us is in respect of the treaty specified in the schedule. The schedule specifies that. It does not specify Command Paper No. 6623. It might have done, but it does not. Instead, it specifies the treaty. My hon. Friend was about to describe the contents of the treaty which we are debating. Therefore, it is manifestly not a question of relevance but is a matter central to the debate, and apparently it is not available.

Mr. Deputy Speaker: Order. I have now had an opportunity of looking at the ruling given by Mr. Speaker on 21st February 1966. He said:
I have decided, therefore, to accept the recommendation of the House of Commons (Services) Committee that in future a Department should supply to the Library in advance a list of all those older papers which appear to it to be relevant to a forthcoming debate.
I take it that that has not been done. I shall hear what the Minister has to say about it.

Mr. Judd: With respect, Mr. Deputy Speaker, I submit that it has been done. As I reminded the House, the documents—the act and the decision—were published in the form of Command Paper No. 6623 and laid before Parliament in October 1976. An explanatory memorandum has been available for some days to right hon. and hon. Members. In the introduction to that explanatory memorandum there is a reference to Command Paper No. 6623. Therefore, I underline that the requirements have been fulfilled.

Mr. Marten: On a point of order, Mr. Deputy Speaker. Time and again in EEC debates—often late at night—it is found that documents have not been available because, of the incompetence of the Department concerned in failing to get them to the Vote Office, which is where they should be so that they are available to hon. Members. On such occasions the Minister has withdrawn the motion. I suggest that that is the correct procedure for him to follow on this occasion.

Mr. Jay: Further to that point of order, Mr. Deputy Speaker. No doubt the Minister is doing his best, but he has not complied with the words that you read out. Surely, those words must be taken to mean that on the day of the debate,


or at least between the time when the business was announced last week and the debate taking place today, hon. Members should be able to obtain the relevant documents. It is no answer to say that two years ago they were handed to the Library if they are not available when the debate takes place. I agree with the hon. Member for Banbury (Mr. Marten) on this matter.

Mr. Deputy Speaker: In response to that point of order, perhaps I should continue to read Mr. Speaker's ruling:
Members will be able to consult this list in the Library "—
that is the list to which I referred—
and to order from the Vote Office such papers as they require, besides, of course, any other papers which they may wish to have."—[Official Report, 21st February 1966; Vol. 725, c. 34.]
That was the position when that ruling was given.

Mr. Judd: rose—

Mr. Marten: On a point of order, Mr. Deputy Speaker. That is precisely what I did about five minutes ago. I went to the Vote Office and ordered the papers, but I was told "We have not got them." Previously on such occasions the Government have withdrawn the document being debated.

Mr. Jeremy Thorpe: Further to that point of order, Mr. Deputy Speaker. How seriously do we take the need for research by an hon. Member who orders the papers only five minutes before the debate begins? It is outrageous and makes a farce of the whole process.

Mr. Marten: Not at all.

Mr. Judd: I express sincere regret if any right hon. or hon. Member has difficulties, five minutes before the debate begins or even when it is under way, in securing papers from the Vote Office. But the memorandum referring to the matter of debate tonight was deposited with the Joint Committee on Statutory Instruments on 11th May. In that memorandum there was full reference to all the appropriate documents. Indeed, the memorandum has been made more widely available to right hon. and hon. Members since 11th May, and there has been reference in it to the appropriate documents. Therefore, if there had been difficulty and if we had been notified of any

difficulty in this respect, immediate action could have been taken. With great deference to all concerned, I submit that it is not accurate to say that the documents being debated tonight have not been available to right hon. and hon. Members.
The decision consists of a preamble citing the articles of the Community's constituent treaties which give authority for direct elections and reiterating the target date of May-June 1978 as set by the European Council in Rome on 1st and 2nd December 1975 for direct elections. This is followed by short provisions concerning the publication, adoption and entry into force of the decision and its accompanying provisions.
The annexed act contains in Articles 1 to 4 the most important provisions agreed between member States concerning the elections and related matters—that is, the framework within which the national provisions adopted by member States are to operate. These provisions require elections by direct universal suffrage, set out the number of representatives from each member State, prescribe a five-year term for the Assembly and make clear that the representatives vote on an individual basis.
Article 5 provides for the possibility of a dual mandate. Articles 6 to 13 provide for disqualification, procedural and supplementary matters. Article 14 lists those articles in the constituent treaties which are to lapse with the coming into force of the agreement. There are also three brief annexes which form an integral part of the Act and a declaration by the Federal German Government concerning the application of the act to Berlin.
There have been few political issues so extensively debated in recent years as direct elections to the European Assembly. The commitment to eventual direct elections to the European Assembly
on the basis of direct universal suffrage
is embodied in Article 138(3) of the Treaty of Rome to which we subscribed on accession to the Community.
As the House is aware, there were several attempts prior to our accession to work out a generally acceptable system of direct elections, but they all foundered on the difficulties of devising a uniform system of election acceptable to each


member State. At the December 1974 meeting of Community Heads of Government in Paris, it was agreed that a new effort should be made to achieve direct elections "as soon as possible", and, recognising the difficulty of reaching agreement on a single electoral system for the whole Community, it was subsequently accepted by both the Assembly and the Council that it would initially be necessary to allow the choice of the electoral system for the first round of direct elections to be left to each member State.
Article 7 of the act annexed to the Council decision of 20th September 1976, however, requires the directly elected European Assembly to draw up a proposal for a uniform electoral procedure, so the search for a uniform system has not been abandoned, but only postponed.

Mr. Spearing: Is it correct that, if the House gives assent to this treaty—a treaty which it has not got before it—it will be ratifying Article 7 as well as the whole treaty? Therefore, in future, will it not be said that the House of Commons and the United Kingdom committed themselves to direct elections by some uniform procedure?

Mr. Judd: We are committed eventually to working out a uniform system, but the system that we now have will be operated until that happens.
The Government participated fully in the negotiations leading up to the signature of the act annexed to the Council decision of 20th September 1976 on direct elections and during this time had frequent occasion to consult and take account of the views of both Houses of Parliament on the significant constitutional issues involved.
In February 1976 a Green Paper on direct elections was published. This was followed by debate in this House in March 1976 and the setting up of a Select Committee of the House of Commons which produced three reports, together with published evidence. The first of those reports was debated in July 1976.
Following signature of the Council act in September 1976, the Government, in April 1977, published a White Paper which was the subject of parliamentary debate. The first version of the European Assembly Elections Bill was published on 24th June 1977 and given a

Second Reading in the House on 3rd July by 394 votes to 147. The Bill was reintroduced into Parliament in a slightly amended version on 9th November and was finally approved by this House on 16th February by 159 votes to 45. Following approval of the European Assembly Elections Bill on Third Reading in another place on 4th May in a form unamended from that in which it had left this House, it received Royal Assent the following day. Before we proceed to ratification it now only remains, as I stated earlier, for Parliament to agree to the specification of the act of the Council and the decision of 20th September 1976 annexed to it as a Community treaty.
The position as regards ratification of the Council act is that all member States have now done so except France and Britain. France has completed all the necessary parliamentary procedures and is in a position to do so at any time. The Council act comes into effect only after completion of ratification by all member States. Until the act is in effect, there can be no legal decision by the Community regarding the date of direct elections.
Article 10 of the act requires that the decision should be taken by the Council of Ministers acting unanimously after consulting the Assembly. The decision of the European Council meeting in Copenhagen on 7th and 8th April in favour of the dates 7th to 10th June 1979 was a political decision and it needs to be confirmed by the Council of Ministers acting in accord with the Article 10 procedure before it has legal effect.
Article 13 of the act provides the legal basis for the determination of emoluments of directly elected Members. It requires unanimous decision by the Council on the basis of a proposal from the Assembly after consulting the Commission. The Government believe that the emoluments issue must be decided before direct elections are held.
Early ratification of the Council act of 20th September 1976, which approval of this order by both Houses of Parliament will enable the Government to complete, will permit all necessary steps of implementation, such as the important determination of emoluments, to be taken at Community level in ample time before the date of direct elections next year.


After the extensive public debate that there has been on direct elections in this country and in the House, early ratification of the Council act by the United Kingdom will demonstrate to our Community partners our firm commitment to holding direct elections on the dates of 7th to 10th June next year.

8.22 p.m.

Mr. Neil Marten: I am afraid that the order is rather unhelpfully drafted. It is unbecomingly drafted, because there is little mention in it of the direct elections. It would have been more open-minded of the Government to have said that this is the ratification of the European Assembly Elections Bill. However, I let that pass. We are getting used to obfuscation in these matters.
It is logical for people such as I to oppose this ratification, which I propose to do. All through the debates on the Bill I voted against it. One of the reasons why I voted against it was that if and when the Assembly comes about it will be toothless. The people attending it, drawing their apparently large salaries, will get extremely bored and frustrated unless they are given greater powers. The French and British Governments and Parliaments will ensure that they do not have greater powers. It will be an expensive operation. Direct elections in this country will cost about £10 million or more. I am sure that many hon. Members can think of far better ways of spending that amount of money.
My second objection is that basically, as most of those who think about these matters know, this is a large step towards a federal Europe. As I have said many times, I am utterly opposed to that. I shall not go on about that because I have expressed my views for a number of years.
When the Assembly is directly elected a great conflict will arise between that Assembly and this House. It will arise fairly smartly after the elections take place. There will also be a conflict between Members of the Assembly—the MEAs—and members of the House. For example, if one of the new Euro constituencies is basically Labour and Labour gains the seat and its Member goes to Luxembourg, to the Assembly, and if there are in that constituency one or two Conservative seats, Conservative Members of this Parliament might

become angry if that Labour MEA comes freely into his constituency to preach an entirely different doctrine from that of the sitting Member of Parliament. That could cause endless trouble. The reverse could happen. It would cause considerable heartburnings among Members of this House. It would be a recipe for conflict and bitterness.
Those who vote for the order and those who voted for direct elections know what they are doing. They will not, therefore, have any right to complain when that happens. But I am sure that they will complain.
I turn to the question of pay and allowances, which the Minister mentioned, and the proposition that they should be taxed according to United Kingdom taxation. When I asked the Prime Minister on 27th April he told me that he did not know the answer himself. He turned to the Chief Secretary of the Treasury and whispered to him "What is the answer?" The Chief Secretary told him clearly that the salaries of the directly elected Members of the Assembly would be taxed at United Kingdom rates. That is right.
On another occasion I tabled a Question for Written Answer by the Prime Minister. I asked him
if he will give an assurance that the final act of ratification for direct elections will not be moved by the Government until the salaries of the proposed Members of the European Assembly have been fixed.
The Prime Minister replied:
The legal basis for determining the salaries of Members of the directly elected European Assembly will be Article 13 of the Council act of 20th September 1976. It will not, therefore, be possible for the Council to reach a decision on the matter until the act has entered into force following ratification by all the member States."—[Official Report, 5th May 1978; Vol. 949, c. 289.]
The Council will decide finally. I fear that once the Council of Ministers has agreed the salaries of the MEAs the Community will then seek to pass a regulation saying that the Community decrees that these salaries will not be taxed by national Governments. I should like an assurance from the Minister on that matter.
That is an assurance that the Minister could give now. He could simply say that in the light of what the Prime Minister said the other day, if such a proposal came forward the Government


would veto it. He could make a firm commitment on behalf of the Government to that effect. He could do that without regard to the level at which the salary will be fixed. That is not relevant. I want the Government to veto any Community proposal that salaries from the Assembly will be tax free.
There is also the question of the allowances that are to be paid. I cannot understand why this matter has not been worked out before. In an article in The Economist on 13th May I read:
On top of this"—
that is, the salaries—
all Euro MPs would get generous attendance and travel allowances, payable at the same cash rate for all nationalities. Present allowances are £54 for each day in attendance at the parliament plus 25p for every kilometre travelled from home … Last year Euro-MPs collected an average of about £21,000 each in expenses (including secretarial allowances). Euro-MPs would get facilities including an office in their own country, a secretary, a constituency agent"—
needed in Britain because of our system—
and a research assistant, plus generous allowances for telex, telephone and postal charges and for domestic travel.

Mr. John Roper: The hon. Member for Banbury (Mr. Marten) has quoted from The Economist. I was not clear what he was quoting—whether that was an actual proposal of the Parliament, or whether it was merely supposition on the part of a journalist employed by The Economist.

Mr. Marten: The article says:
An unofficial paper is now circulating in Brussels which offers an ingenious solution. It runs as follows".
I was quoting from that unofficial paper circulating in Brussels. I am not saying it was a proposal, but it gives some idea of what was circulating in the minds of the people who are responsible for these matters.
The second question that I want the Minister to address his mind to is whether the very generous allowances will be treated in such a way that the Member of the European Assembly, being subject to United Kingdom tax, will have to justify that expenditure to the Inland Revenue and will be taxable on the balance that he may draw. I should like that assurance. I am sure that is a

perfectly routine matter for the Inland Revenue to agree.
There is a third point which is perhaps more of a Treasury matter. If the Minister knows the answer I should be grateful if he will give it to me. What happens if, for example, a Member of the European Assembly draws his expenses or part of them in Belgian francs which he brings back to this country? If he pays his secretary here in Belgian francs and she takes the money to the bureau de change and changes it back into sterling, could she not in that way avoid income tax simply by claiming it was money she had brought into the country from abroad? That needs a bit of tightening up. The whole area of taxation needs thoroughly tightening up before we go ahead with these elections.
Finally, there is the lunacy of the location of the Assembly. I am sure that here the right hon. Member for Devon, North (Mr. Thorpe), who has been muttering under his hand, giving a running commentary while I have been speaking, will agree that the way in which the Assembly moves from Luxembourg to Strasbourg and from Strasbourg to Luxembourg is one of the many lunacies of the European Community. That is something which ought to be settled before we go ahead with any elections, should the House vote in favour of the order tonight. In general, the whole thing is a complete waste of resources.

8.34 p.m.

Mr. Douglas Jay: Apart from some of the general considerations that the hon. Member for Banbury (Mr. Marten) put before the House, this order is another disturbing example of the profoundly unsatisfactory way in which EEC legislation is now being dealt with in this House. This order is designed to give legal force, binding in United Kingdom courts, to an agreement reached by Ministers in September 1976 and so to facilitate direct elections to the EEC Assembly. I hope that my hon. Friend the Minister will confirm that the legal position is that if the order is not approved by the House tonight, direct elections, in the United Kingdom, at any rate, cannot go ahead.
All that the Leader of the House did when he first announced this week's business last Thursday was to describe the order as "The European Communities


(Definition of Treaties) (No. 4) Order". I do not think that that would have conveyed a very great deal of its true import to most hon. Members in the House. When one looks at the order, one sees that all that the explanatory note, so-called, tells one is that
This Order declares the treaty mentioned in the Schedule to be a Community Treaty as defined in section 1(2) of the European Communities Act 1972.
I do not think that that would carry many hon. Members very much further.
In fact, it is not until one turns to the Foreign Office explanatory memorandum that one discovers the reference to the White Paper about which we heard earlier tonight, setting out the actual treaty in question, and one finds out that it is all something to do with direct elections to the European Assembly. Then, when one goes to find the treaty that we are declaring to be legal in this country, one finds that it has not been readily available in the Vote Office to most hon. Members seeking to get it for several days after the announcement of the debate was made. This seems to be a very extraordinary fashion in which to ask the House to legislate.
We are then told by the explanatory memorandum—which, incidentally, the Minister did not have the face to sign himself, for some reason—that certain parts of the act or the treaty may be directly applicable, as law, in this country. But the Government are not able to tell us which parts. They are not even able to tell us which parts of the act in question will automatically become law in this country. I quote the exact words of the explanatory memorandum:
it is thought that, although no undertaking can be given as to the completeness or accuracy of the list, the following Articles of the annexed Act contain or may contain directly applicable provisions.
Then it proceeds to list them.
Therefore, the Minister is, in effect, telling the House "I am asking the House to enact certain legislation which is directly enforceable in the courts of the country, but I cannot actually tell you what this legislation is because I do not know, and apparently no one else does, either." That is the point in legislation, indeed, as a procedure, that we have reached in the case of EEC legislation being imposed on this country.
I really do not know what would be thought of a Minister who asked us to legislate in that way without telling us what the legislation meant, on any subject other than the EEC—on taxation or anything else that one cares to mention. But apparently certain hon. Members do not mind this complete neglect and disregard of all decent principles of legislation as long as it has some relationship to the EEC.
My hon. Friend the Minister and the hon. Member for Banbury spoke on the question of the emoluments that Members of the European Assembly are to receive. I noticed that the Minister used the word "emoluments", and not "salary". Therefore, I imagine that he also had in mind that there may be considerable expenses allowances as well as salary.
It seems to me exceedingly unsatisfactory that we are expected to approve the order without knowing what salaries or what level of expenses the Members of the Assembly will receive. After all, some of the money is British taxpayers' money, which is now being paid at the rate of nearly £700 million a year net into EEC funds. Thus, we are being asked tonight to vote money for the salaries of the Members of the Assembly without our having any idea of what the actual figures will be.
My hon. Friend the Member for Farnworth (Mr. Roper) questioned the quotation from The Economist which the hon. Member for Banbury mentioned a few minutes ago, and I shall therefore revert to precisely what The Economist said on 13th May and what the sources of its information were. Incidentally, it first stated that the salary of a German Member of Parliament, which is being cited as one criterion that one ought to use, is now, in sterling terms £22,700 a year.
The Economist then stated—this was not mere speculation by a journalist in Brussels—that a committee of the EEC Assembly itself has recommended a salary for the elected Members of the Strasbourg Assembly of £35,000 a year, subject, I presume, in the case of this country, to British income tax. But what I regard as more disturbing—this is again a statement of fact, not speculation—is that The Economist then added that on top of the salary
all Euro-MPs would get generous attendance and travel allowances, payable at the same cash


rate for all nationalities. Present allowances are"—
this is a statement of fact—
£54 for each day of attendance
plus a lot more for travel.
Then The Economist went on:
Last year Euro-MPs collected an average of about £21,000 each in expenses"—
that is, in addition to the salary. That is what The Economist said. It was a statement of fact, and I suppose that those facts are known to the Government and, possibly, to some hon. Members. It would be interesting to be told whether that is correct. I am only asking, but is it correct that, in addition to salary, last year these Euro-Members collected an average of about £21,000 each in expenses, some, presumably, getting less and others, in that case, getting more?
We ought to be told. Is it true that that has been the situation up to now? If so, it seems to me that if we were to send Members from this country to the European Assembly on financial conditions of that kind, it would be regarded by many people here as a scandalous operation, with even an air of something pretty near corruption about it.
I do not believe that the House should become involved in any sort of slush funds—or whatever one cares to call them—of this kind. Are we to have a situation in which there will be Euro-Members of the Assembly receiving about £20,000 a year in salary, for rather fewer hours of work than we do in this place, and another £20,000 tax-free in expenses on top? It seems to me so out of relation to any sort of rate for the job or what people are paid in comparable circumstances that it would be intolerable if that were to happen.
If the Minister can give an assurance that no such figures as those will be accepted by the Government, we shall, I think, have made a little progress, but I repeat that I think it profoundly unsatisfactory that we should be asked to approve the order tonight without any of these facts or any firm information being before us—and that, in itself, in my view, is sufficient ground for hon. Members to vote against the order.

8.45 p.m.

Mr. Douglas Hurd: This order is a further step forward in a cause

—that of holding direct elections to the European Parliament—which most of us on this side have heartily welcomed and exerted ourselves to forward—[HON. MEMBERS: "Not tonight."] I am talking of debates over three years now, during which the opinion of this party, and, indeed, of the House as a whole, has been expressed unmistakably. So this is a further step forward, but there are a number of important points raised in the Minister's speech on which he should elaborate.
The Minister mentioned ratification by others; he said that, apart from ourselves, only France still had to ratify and that that was imminent. What is the position about domestic legislation? Obviously that is also a precondition of having elections next June. Our domestic legislation has achieved Royal Assent. What is the position in the partner States?
Following our own arrangements, I understand—I should be grateful for confirmation—that the next step is that the regulations for the conduct of our elections will be published after consultation with the political parties. I understand that that consultation has not yet started, but the Minister's colleagues in the Home Office promised when we discussed the Bill that those regulations, which will be of great importance, will have to be approved by the House. Therefore, time is pressing if we are to have consultation about the regulations, publication of them and debate and approval before the Summer Recess.
We tried to incorporate in the Bill some matters which seemed important to us, such as the level of the deposit and the regulation of election expenses. The Government said that they would prefer those matters to be included in the Home Office regulations. That makes it all the more important that there should be no skimping of the procedure for discussing the regulations. I accept that this is a Home Office point, but I hope that the Minister will be able to say something about it.
The subject of salaries and allowances has dominated the debate. My hon. Friend the Member for Banbury (Mr. Marten) rehearsed his strong constitutional objections to the whole idea of direct elections. He then talked about salaries and allowances. Others less fastidious than he are now concentrating


their whole opposition on the question of money. This is a great pity. [HON. MEMBERS: "No."] I referred to others less fastidious than my hon. Friend.
One has only to be present when this matter is discussed at Prime Minister's Question Time to see that, immediately, those who oppose our membership of the EEC home in on the question of cash. I do not complain about that, but it is a pity because the politics of envy have a sufficient grasp of our life already without that.
The right hon. Member for Battersea, North (Mr. Jay), who is normally a careful debater, was a bit free with his talk of posible corruption and of slush funds. He was following a trend which has gone too far.

Mr. Norman Buchan: Does not the hon. Gentleman simply think that this happens because that kind of money adds insult to the gross injury of this whole procedure?

Mr. Hurd: I am coming on to what I think should be done, and I suspect that the hon. Member will agree with me.
It is most important that the right response is for the House and the Government to take as severe—and, indeed, puritanical—an approach to this matter as is compatible with the proper working of the European Parliament. That is necessary because one of the most harmful things about the EEC's reputation in this country is the feeling that it is a rich and expensive gravy train. Much nonsense is talked on that subject, and it is up to this House and the Government to ensure that it is shown to be nonsense.

Mr. Jay: Is the hon. Gentleman prepared to say that he would not approve a level of, say, £20,000 in salary, plus £20,000 in tax-free expenses?

Mr. Hurd: The right hon. Gentleman must not hurry me on. I shall deal with what I mean by the severe and puritanical approach which I think is necessary.
On the subject of procedure, when will the Council of Ministers take this decision, and in what circumstances? The Minister said that it would be dealt with on a proposal by the European Assembly. But what happens if the present European Parliament makes no such proposal?

There has been a working party on the subject, but I understand that it is a long way from making a definite proposal, and, indeed, may never do so.
What, then, is the procedural position? Is the Council of Ministers prepared to tackle this matter on its own? It seems to me, and, indeed, to most of us, that the sooner the Council tackles the matter, the better. The situation should not be allowed to drag on. It should be brought before the Council of Ministers at an early opportunity. If there are procedural hang-ups or if everybody waits for everybody else, as sometimes happens in these matters, Her Majesty's Government should ensure that discussion is started in the Council of Ministers and that a decision is taken as soon as possible.
Personally, I believe that the case for a common salary for Members of the European Parliament is overwhelming and that it would be wrong to pay different people different rates for doing the same job in the European Parliament. But I think it is possible to use that argument in terms of common purchasing power rather than in terms of common cash.
The Commission in handling its own employees follows exactly this principle. It applies what is known in the jargon as the corrective coefficient. That means that the salary of a Community employee is related to the cost of living in the country where he actually works. If this is applied to a British Member of the European Parliament, it would mean that he would be given about half the salary of his German equivalent because it would be deemed that the British Member would be living in this country where the cost of living is correspondingly lower than in Germany. That is a principle that is already adopted and accepted in terms of employees of the Commission. In view of the need for a severe approach, it is well worth considering whether this is the right principle to be applied by the Council of Ministers to the salaries of Members of the European Parliament.

Mr. Sydney Bidwell: Surely, in reality the Member would be spending part of his life in Europe and part of his life back home. He may leave his family in this country or move his family out of this country. Therefore,


there is no comparison between his position and that of employees who are domiciled in one country and who spend their entire time there.

Mr. Hurd: That depends on how they organise their lives. There might need to be adaptations. This principle, which is helpful and useful and is already applied in the Community, could be of assistance in deciding this matter.
I now wish to deal with the subject of taxation. Mention has been made of competence. There has been discussion in the Press on this point, and the Minister should clear it up. Is it the Government's view, after taking legal advice, that the subject of taxation of British Members of the European Parliament is within the direct control of Her Majesty's Government and of this House?
The Government in recent months have made a number of slightly ambiguous remarks on the subject of taxation. Ministers have sometimes spoken of taxation under United Kingdom rates. They have sometimes talked of taxation under United Kingdom rules. I am not a tax expert, but there is a significant difference between the two. This concerns the point raised by the hon. Member for Ealing, Southall (Mr. Bidwell).
As I understand it, under the tax rules the question would then arise whether Members of the European Parliament were deemed to be resident in this country or overseas. It seems to me that it should be established as a principle, and I hope that the Minister will agree, that British Members of the European Parliament should in principle be taxed at the same rates as those they represent. That is a principle of great importance politically for the success of this experiment in direct elections. Despite the statements that have been made, this whole situation is still somewhat ambiguous and I hope that the Minister will clear it up.
Then there is the question of allowances. If all that I have said about salary and taxation is accepted, it is clear that in these circumstances salary and taxation so defined would not be enough to cover all the necessary expenses. Nevertheless, it must be right to apply the same basic principle again that allowances should be strictly related to necessary expenditure actually incurred.
We in this House are not in a very strong position—I rather glide over this point—to preach at others about control of expenditure actually incurred by Members of Parliament. Nevertheless, I think that this is a right principle, and it may be that if they work out proper procedures for the control of expenditure actually incurred other people will be able to give us a lesson in the matter.
I ask the Minister to expand a little on his reference to a common electoral system for later rounds of elections to the European Parliament. This is a very important matter. We have not really begun to discuss it and it is natural that we should not do so at this stage. Nevertheless, when does the Minister foresee discussion of the subject beginning and in what forum? Is this something that the directly elected European Parliament will be expected to start, or is it something that the Council of Ministers will start discussing off its own bat? We need to know something of the time scale. These are early days, but we should have an assurance that no proposals or position will be taken by the Government on this very important point of a possible future common system until this House has had an opportunity to debate the matter further.

Mr. Max Madden: What is the hon. Gentleman's attitude to the principle of duel membership of this House and the European Assembly? If he supports dual membership, would he believe it right for any candidates in a forthcoming General Election in this country which took place before next June to declare whether they intended to stand for election to the European Assembly?

Mr. Hurd: I do not think that it is possible for anyone in this House to say that a dual mandate is impossible or out of the question. We discussed the point during the passage of the European Assembly Elections Bill. There was no disposition on the part of the House to put into the Bill a clause excluding the dual mandate by law. Nor, I would think, would any political party wish, as it were, to outlaw it.
I think that practical difficulty would arise when it came to persuading a constituency selection committee that one could do both jobs satisfactorily, and I


think that that would be an almost insuperable task except perhaps in a handful of cases. The hon. Member for Sowerby (Mr. Madden) has pointed to one of the difficulties. That is particularly so in view of the timing at which the first direct elections are working out. It seems to me that if an hon. Member is proposing to try to persuade a selection committee that he could do both jobs, he would be well advised to let his present Westminster constituency know fairly soon that he wants to make the attempt. But that is essentially for the individual and the selection committees when they start choosing candidates for these first direct elections, presumably at the turn of the year.
In the short time that I have been here, there has not been an issue which has been debated so long and so often and, on the whole, so interestingly. We shall never reach total agreement on the points of principle. This is a further step forward. There are important practical matters which still have to be elucidated. I hope that the Minister will be able to clear up some of them when he replies and that he will let us know later about others. But the principle of the order is, in our view, welcome, because it is a further step along a road which we tread with some enthusiasm.

9.0 p.m.

Mr. Nigel Spearing: I agree with one point that the hon. Gentleman for Mid-Oxon (Mr. Hurd) has made, and that is that direct elections have been debated regularly and interestingly, but in more or less everything else I part company with him straight away.
Although the debate is ostensibly about an order—the Draft European Communities (Defintion of Treaties) (No. 4) Order 1978—it is an order which designates a treaty to which the United Kingdom may become a party. It is concerned with the way in which this House ratifies, or does not ratify, a foreign treaty.
This is, I think, the first major debate—other than a late night debate, with half a dozen people in the House—whereby the Government wish to ratify a treaty under the procedure laid down in Section 1 (3) of the European Communities Act 1972. That, I think, is very important. I am informed that, until that

Act was passed, this House did not have to ratify treaties entered into by a Government. All that happened, under the Ponsonby rules, was that if the House chose to disagree with the terms of the treaty within 40 days, that treaty was not considered binding. But, since our membership of the European Economic Community, at least in relation to Community treaties, the opposite procedure has applied. In other words, we have to ratify, as part of our new written constitution, treaties entered into not by Her Majesty's Government alone but by Her Majesty's Government as part of the EEC, and that is a very different matter.
The debate tonight is about something of which we have a working knowledge—direct elections to the EEC Assembly. We have a working knowledge of it not only because of the debates to which the hon. Gentleman referred but because we have had a Bill and that Bill has now become an Act. That, I suggest, is fortuitous. Any European Communities (Definition of Treaties) Order could come before this House when there had been no general debate about the issues, when there had been no Bill, and when there might be no knowledge of the matter in question. In addition, there might also be no treaty available in the Vote Office, which is the position faced by the House tonight.
It is not just any ordinary treaty, either to trade with Israel or to give wheat aid to some South American State, which some of them have been; it is a question whether this House should ratify a foreign treaty, or a treaty which is a matter of foreign affairs from the point of view of the United Kingdom, which sets up and establishes what could be a rival Assembly. That is what tonight's debate is about, and that is the question before the House.
The treaty is not available. What a reflection on the way in which we go about these matters. But it is even worse than that, because the order before us designates the treaty, as it says in the schedule, and the schedule refers to an act concerning the election of representatives of the Assembly, and so on. It does not say, in the schedule to the order, that there has been a Command Paper 6623, which was presented to Parliament by the Secretary of State in October 1976. The order does not even mention it.
This, I think, justifies up to the hilt the sort of thing that we have been saying time and time again—that the way in which the European Communities Act works, and the way in which the Government operate, or are forced to operate, by membership of this outfit, means that this House is being asked to approve things clandestinely, without openness.
We talk about open government, but the Government cannot even present the treaty that we are supposed to be discussing. Moreover, it is a treaty which does not present direct elections as we have discussed them. As my hon. Friend the Minister of State admitted in his introduction, Articles 7 and 11 of that treaty commit the United Kingdom in principle to the eventual adoption of elections by a uniform procedure. I know that they may not come for some time, but that is what it does. If that is not federalism I do not know what is.
When speaking on this subject the Foreign Secretary said:
I am well aware that in 10 years' time events may have confounded any analysis that I make. The way that Europe has evolved has been extremely hard to predict.
In my view it is time that we all recognised how unreal the debate about federalism has become."—[Official Report, 20th April 1977; Vol. 930, c. 206.]
My hon. Friend the Minister of State had to admit that this non-existent treaty before us tonight is committing this House to elections throughout the EEC by a uniform process. Yet the Foreign Secretary not only says that the debate on federalism has become null and void—which it has not, because it is before us tonight—he cannot even predict which way the matter will go. We all know that there are differences of view about the way in which this Assembly will operate once it becomes directly elected if, indeed, we ever get that far.

Mr. Roper: I have listened with care to what my hon. Friend has said about this dangerous new commitment that we are taking on with regard to eventual elections under a common system. Does he admit that that obligation to have elections by a common system is one that was already apparent within the Treaty of Rome, and one that we have considered for some time within this House?

Mr. Spearing: I do not agree with my hon. Friend, for the simple reason that it is not apparent. I have before me the Article 138 in question. Paragraph 3 states that
The Assembly shall draw up proposals for elections by direct universal suffrage in accordance with a uniform procedure in all Member States. The Council shall, acting unanimously, lay down the appropriate provisions, which it shall recommend to Member States for adoption in accordance with their respective constitutional requirements.
In other words, it can be vetoed not just by the member of the Government in the Council but by this House. That is not an obligation, because it is written in as a veto. At least it is the only veto there is, because the other vetoes are not really there, unless there is a qualified majority. That is a non-existent veto, just as we have a non-existent treaty.
I am afraid that I disagree with my hon. Friend. I believe that I am right to disagree, quite apart from the fact that in the official literature no commitment to direct elections was mentioned at all. I can find nothing in the White Paper of 1971, published by the right hon. Member for Sidcup (Mr. Heath), which says anything about it, either. He was the man who should know, because he believes in direct elections.
Indeed, in an intervention to the Prime Minister on 29th March 1976 I said:
the choice of our own electoral procedure is pending the entry into force of a uniform electoral procedure.
He replied:
I know that it is in the document, and if my hon. Friend will contain himself I shall explain what has to happen. It has taken 18 years or so to reach the present stage. I do not know but I am willing to have a modest bet with my hon. Friend that he will be retired before we reach the second stage about which he is so worried, because it will demand the unanimous agreement of all the member States before they ever get there."—[Official Report, 29th March 1976; Vol. 908, c. 910.]
Sir Alec Douglas-Home, when Foreign Secretary, said the very same thing to this House in respect of direct elections themselves. That was not 18 years ago; it was 10 years ago. He said that we may have to have constitutional developments. He said that the matter would have to be unanimous in the Council and that it would have to come before this House. It is before it tonight. Therefore, I say to the Prime Minister that what Sir Alec Douglas-Home said 10 years ago may


well happen again in respect of direct elections by common procedure. The law is quite clearly there. I see that my hon. Friend the Member for Farnworth (Mr. Roper) agrees. He is always fair in debate, just as I try to be.
Earlier in the debate the hon. Member for Banbury (Mr. Marten) raised the question whether it is proper for the debate to proceed. Here we have a very important international treaty designated by this curious kack-handed, secretive procedure, not of tabling a motion to say that the House approves the treaty, Command 6623. That would be the open way of doing it. That could have been written into the European Communities Act if the hon. Member for Bexleyheath (Mr. Townsend) wanted it. That would have been the right way to do it. Had it been there, that would have been handed out to the Vote Office and the Table would have had a copy of it for reference purposes to see that we were in order in what we were talking about. However, neither of those things has happened, formally at least. So we have not got it with us.
Mr. Speaker, your predecessor in the Chair read out the ruling of Mr. Speaker of 21st February 1966, which stated that in the event of documents not being available there would be a list available in the Library and hon. Members could find out about it. My researches in the matter are not complete. Later in the debate I may wish to raise the matter. It is of great constitutional importance. We are asked to ratify a treaty which hon. Members cannot obtain.
The Lord President may say that in this typewritten memorandum "Command 6623" appears in brackets. That may be so, but Command 6623 is not available. If my hon. Friend does not say that on principle he will not put the motion, there might be some other treaty, about which there might not be so much interest, and which might not be available either. The Government would say "Ah, but Command 6623 was not available on the night of 23rd May. What are you worrying about?" I suggest that custom, practice and precedent in these matters are all. That is why the matter should not be entirely left for the moment. When I have made more inquiries I may wish to raise something about it.
I suggest that there is a wide variety of views about the way in which the Assembly, if it is elected, will operate. Some people say that it will be only an advisory chamber. It will not be an advisory chamber, because it has already changed the nature of the budget. It may have relatively limited powers, but it was admitted in our debates on the European Communities Act that there had been a tennis match between the Council and the Assembly over the last budget and that the Assembly had rung changes. The Assembly already has the sanctions of expenditure. Therefore, it could develop in ways in which the House would not wish it to develop.
On the other hand, some hon. Gentlemen say that it will not be like that at all. They say that it will consist of a lot of people who do not want to come here or who may have come here and not wanted to continue and that it will not be very active. Some people, unkindly but not without point, have said that it will become Mr. Jenkins' poodle. There is evidence of that. Civil servants and servants of the EEC can speak in the EEC Assembly. The traditional split between the Executive and the legislature is all mixed up. That should make people pause for thought. Mr. Jenkins, speaking in the EEC Assembly on Tuesday 13th December 1977, said:
May I say that one objective we have in mind
—that is the Commission—
is to be able to put forward proposals which will command the support of Parliament without amendments being necessary.
It is nice to put up something which is within the ideas of Parliament. But does that mean to say that the Assembly has not any power?
If the Commission is to follow that line it means that the only proposals that it can put before the Council of Ministers are those which will be acceptable to this directly elected Assembly which is not supposed to have any power. Not only does it have powers over the budget in some manner or other, which is exactly the way in which this House gained its power; if Mr. Jenkins is correct, and there is no reason why he should not be—and there is no reason why another Commissioner should not follow the same policy—it will have other powers, too. Therefore, the views of the Assembly act


as a constriction, as a sieve, sifting out matters which it does not like.
The Council may wish to act in all sorts of ways, but if the constriction of the Asesmbly's assent operates, the Council will never have the proposals before it on which it might be able to act. I do not say that that is what will happen, but it is clearly a strong alternative.
I come now to the effect of these possible elections, if ratification comes. We must not forget, of course, that there will be other Assemblies which have to ratify this treaty. I refer to the effect upon the parties and upon our democracy. Addressing the British Labour Club in Brussels on 6th February 1978, the Foreign Secretary, talking about the EEC debate, said:
This debate has divided families in Britain and has, at times debilitated both our party and the country.
I do not think that anyone would disagree with that. Whatever views we hold about the EEC, whether we are federalists, unionists, anti-EEC or whatever, we would agree about that. That is the situation without the fact of direct elections. When we come to the selection of candidates, when we come to the argument about what the Commission should be, when we get a "pro" Labour man against an "anti" Conservative man—if there are any—the cross currents can only further debilitate the traditional party structure and democratic machinery of this country.

Mr. Rooker: That is the idea.

Mr. Spearing: My hon. Friend may be right. Even if he is not right, I believe that a written constitution of the sort to which we are now binding ourselves would inevitably have that effect. Inevitably, in politics it is the unintentional and unforseen secondary effects which are the most virulent. I believe that that is true in respect of this treaty more than anything else that the House has had to debate, certainly this century.
The House may think that I am exaggerating. This is where I return to the treaty, which, alas, the House does not have before it, which my hon. Friends and I cannot consult, which the Government have not seen fit to put in the Vote Office, and which the order

ratifies. The treaty is yet another addition to the written constitution of the United Kingdom. It may well be irreversible. The freedoms and the democratic processes to which we in the United Kingdom are heir and in which we are proud to participate, depend upon an unwritten, tacit agreement, upon the conventions of the constitution and ultimately upon confidence between those of differing political views—confidence in each other and in the system which we operate.
I suggest that if we ratify this treaty tonight that confidence will not exist for much longer in the same form. Inevitably this written form of constitution, the statutory elections and the statutory duties and responsibilities of those so elected, cannot fail to undermine the practice and traditions of this place and with it the freedoms and traditional democratic practices of the British people. That is why it is so ironic and so typical that when the House is asked to ratify the treaty we cannot get hold of it and hon. Members going to the Vote Office cannot get a sight of it.

Mr. Madden: On a point of order, Mr. Speaker. You have doubtless been told by Mr. Deputy Speaker prior to your arrival in the Chamber of the important matters which have been referred to by my hon. Friend the Member for Newham, South (Mr. Spearing) concerning the non-availability of important documents relating to the order. You will know of the circumstances, which my hon. Friend has described at some length. I believe that these are important revelations which he has brought to the attention of the House. Surely the appropriate course of action for the Government to adopt would be to adjourn debate on the order so that the omissions of documentation can be repaired by the Government and the debate continued at another time when hon. Members are furnished with the relevant papers.

Mr. Roper: Further to that point of order, Mr. Speaker. I realise the problems that are before the House—at least, for those hon. Members who were not able to acquire a copy of the Command Paper in time for the debate by sending the appropriate document to the Vote Office and having one supplied to them.
Before giving your ruling on this matter, I ask you to remember the ruling


given by Mr. Speaker King on 10th November 1965 on the question of the availability of papers. He made it quite clear that the matter of the supply of papers was not for the Chair but for the Government. Indeed, even the question of what papers were relevant was a matter not for the Chair but for the Government.

Mr. Speaker: I also have a ruling that was given by Mr. Speaker on 21st February 1966, in which he said quite clearly:
I have decided, therefore to accept the recommendation of the House of Commons (Services) Committee that in future a Department should supply to the Library in advance a list of all those older papers which appear to it to be relevant to a forthcoming debate. Members will be able to consult this list in the Library and to order from the Vote Office such papers as they reqiure, besides, of course, any other papers which they may wish to have."—[Official Report. 21st February, 1966; Vol. 725, c. 34.]
Perhaps the Minister would like to comment.

Mr. Judd: Further to that point of order, Mr. Speaker. No one is more concerned than I am that the House should have every opportunity for proper scrutiny of all EEC matters. As my hon. Friend the Member for Newham, South (Mr. Spearing), with his passionate sincerity of commitment which nobody on either side of the House would challenge, has pointed out, this is a crucial issue.
But of course, Mr. Speaker, in the statement that you have just made you reminded the House that a list of relevant documents should be provided. The list of relevant documents has been provided in the form of the explanatory memorandum. Then, in your statement you said, Mr. Speaker, that it should be for the Member who so wished to go to the Vote Office and order or secure for himself a copy of those relevant documents which he feels he requires for the purposes of the debate.
All the documents referred to in the explanatory memorandum have been available in the past in the Vote Office. What seems to have happened is that this evening some hon. Members have found that supplies have been exhausted. If an explanatory memorandum is lodged on 11th May, as was the case in this instance, hon. Members have had ample facility to go to the Vote Office and secure the document that they want. It is not a matter of the document never having

been lodged in the Vote. Office; it is simply a matter of supplies having been exhausted. If hon. Members had been to the Vote Office in sufficient time, they could have secured the relevant document. Therefore it is not in the spirit of the statement you have just made, Mr. Speaker, that we should have to take exceptional action tonight, because the document has been available in the Vote Office for two years.

Mr. Jay: Further to that point of order, Mr. Speaker. Would you be prepared to accept a motion, if I moved it, to adjourn this debate so that we can ascertain whether the Government really have—and I think they have not—complied with the ruling which you recently read out?

Mr. Speaker: In view of the ruling that was given by Mr. Speaker in 1966, I would be prepared to accept such a motion.

Mr. Jay: I beg to move, That the debate be now adjourned until such time as the relevant documents are before the House.
It seems to be perfectly clear from the statement that you have made, Mr. Speaker, that the Government are bound, when they announce the business for the coming week, to place in the Library a list of the documents which are relevant to the debate. Nobody disputes that the White Paper. Command 6623, is relevant to the debate. After all, it is the document that we are declaring to be legal in the United Kingdom. It is not merely relevant, it is essential. It is inconceivable that the debate could continue without it.
My hon. Friend the Minister of State says that, although the document was not available to any hon. Member who went to the Vote Office in the past 48 hours, at some date—I think 18 months ago—it was placed in the Library and, presumably, was available in the Vote Office. However, at some date unknown after that supplies became exhausted. Therefore, during the period since the debate was announced, which was only last Thursday, it has in practice not been available to hon. Members.
Surely it is not complying with the ruling to which you have referred, Mr. Speaker, if a Minister says "I have


placed in the Library a list of the relevant documents but, unfortunately, the most relevant of them was totally unobtainable when the list was read." That does not seem to be complying with the spirit of the ruling or with the letter of the requirement.

Mr. Kenneth Clarke: Will the right hon. Gentleman give way?

Hon. Members: No. This is a point of order.

Mr. Speaker: Order. It is not a point of order. The right hon. Member for Battersea, North (Mr. Jay) is moving to adjourn the debate.

Mr. Kenneth Clarke: Will the right hon. Member for Battersea, North (Mr. Jay) tell us when he applied for a copy of the relevant document, Cmnd Paper No. 6623? Will he tell us whether he has a copy of the document?

Mr. Jay: The hon. Gentleman's intervention shows that I was wrong to give way, as I was about to make those matters clear.
As soon as the announcement was made last Thursday that the debate would take place today, I went to the Vote Office and asked for the document. I was told that it was not available but that if I put in a request the Vote Office would ascertain whether it could obtain it. I continued to make requests for the document on six occasions between Thursday afternoon and today. Finally, I secured a copy today—it may have been late last night—after a good deal of persistent effort. At that stage I had a copy of the document, but many hon. Members have found it not possible to obtain a copy in the past 24 hours. I do not think that it is complying with the regulations that in order to have a copy of the most important document in the debate it is necessary to devote almost one's full time for four days to that end.

Mr. Judd: I have already made plain how seriously I and my colleagues in Government take the availability of documents. In the best possible spirit, I suggest to hon. Members that if we are to be certain in future in our consideration of EEC matters that the spirit of

that which the House has laid down is being observed, a great deal of co-operation is required between the House, the authorities and the Government.
In good faith we prepared an explanatory memorandum. I listened carefully to what was said about secretiveness and the contradiction in terms of open government. When that was being said, I was reading the explanatory memorandum. Although I accept that there may be argument about whether the memorandum could have been better drafted, it is an honest attempt by the Government to fill in the background of that which is before the House.

Mr. Buchan: rose—

Mr. Judd: In the context of the explanatory memorandum, we referred to all the relevant documents. These documents had been available to the House. If the Government had received any indication that supplies had become exhausted, and if the authorities had received such information, I am sure that action could have been taken to put things right.
We have already been told by my right hon. Friend the Member for Battersea, North (Mr. Jay), who has associated himself with the motion, that he has been able to secure the relevant document. Therefore, it is not a matter of the document not being available. I suggest that many hon. Members who have raised this issue—I understand the spirit in which it is raised—have also been able to obtain access to the relevant document. Therefore, I feel that in the circumstances the spirit of what was laid down by the House is not being breached on this occasion. After careful consideration, I feel that I have no alternative but to oppose the motion.

9.30 p.m.

Mr. Ronald Bell: rose—

Mr. Speaker: Order. I wonder whether the House would like to come to a quick decision on this matter. Shall I put the Question? [HON. MEMBERS: "Yes."] The Question is, That the debate be now adjourned. As many as are—

Mr. Ronald Bell: I think that there is a certain danger of these matters being


passed over too lightly. That was indeed the burden of the main debate before the motion to adjourn the debate was moved. With respect to the Minister, it is no longer a point of order whether the technical requirements of the document which you read out, Mr. Speaker, have been complied with. I doubt whether they have been, because putting an explanatory memorandum in the Vote Office is not lodging a document in the Library, which is what Mr. Speaker's predecessor ruled should be done.
This is a matter of the highest importance. If the motion were to go through tonight, a considerable number of questions—I confess that I do not know which ones, because the explanatory memorandum may or may not correspond with the White Paper—will be permanently removed from the competence of Parliament. That is what we have to get clear. They become designated treaties under the European Communities Act 1972 and they become the law of the United Kingdom which we cannot thereafter repeal or alter. It is an irreversible process and it will be decided tonight.
If we pass the order, among other things we shall be committed to direct elections in future on a uniform system throughout the Community. The House will not be able to debate that matter again. Therefore, we are dealing with a matter of the highest importance.
The document containing the matters which will be removed from all future

consideration by the House is not before us. It is no use saying that if, when the business was announced, hon. Members had put in for the document they might have got copies just in time, as did the right hon. Member for Battersea, North (Mr. Jay).

The answer is that the nature of this business is not at all clear. I confess to having been totaly misled. It is rather fortuitous that I am here this evening. The title of the document sounded totally innocuous—European Communities (Definition of Treaties) (No. 4) Order. How was anyone to know that on an order called the "(Definition of Treaties) … Order" we were going to vote away for ever our right to consider the important matters in that treaty? Perhaps we should read through every document that is mentioned, but we do not. I put it to hon. Members—the decision lies with the House, not with the Chair—that, whatever their view of the European Communities, this is too important a matter to be rushed through without the relevant document.

Mr. Roper: rose—

Mr. Speaker: Is it the will of the House that I put the Question?

Hon Members: Yes.

Question put, That the debate be now adjourned:—

The House divided: Ayes 61, Noes 119.

Division No. 224]
AYES
[9.34 p.m.


Aitken, Jonathan
Fowler, Gerald (The Wrekin)
Powell, Rt Hon J. Enoch


Atkinson, Norman
Gow, Ian (Eastbourne)
Price, C. (Lewisham W)


Bean, R. E.
Grocott, Bruce
Richardson, Miss Jo


Bell, Ronald
Henderson, Douglas
Robinson, Geoffrey


Bennett, Andrew (Stockport N)
Hoyle, Doug (Nelson)
Rodgers, George (Chorley)


Bidwell, Sydney
Jay, Rt Hon Douglas
Rooker, J. W.


Biffen, John
Kilfedder, James
Ross, William (Londonderry)


Body, Richard
Lamond, James
Skinner, Dennis


Buchan, Norman
Latham, Michael (Melton)
Spearing, Nigel


Budgen, Nick
Leadbitter, Ted
Spriggs, Leslie


Callaghan, Jim (Middleton &amp; P)
Lestor, Miss Joan (Eton &amp; Slough)
Stewart, Rt Hon Donald


Canavan, Dennis
Loyden, Eddie
Thomas, Ron (Bristoll NW)


Clemitson, Ivor
McDonald, Dr Oonagh
Tilley, John (Lambeth, Central)


Cook, Robin F. (Edin C)
Marten, Neil
Torney, Tom


Craigen, Jim (Maryhill)
Maxwell-Hyslop, Robin
Welsh, Andrew


Ellis, John (Brigg &amp; Scun)
Maynard, Miss Joan
Wise, Mrs Audrey


Evans, Gwynfor (Carmarthen)
Mikardo, Ian
Woof, Robert


Evans, John (Newton)
Mitchell, Austin



Fernyhough, Rt Hon E.
Moate, Roger
TELLERS FOR THE AYES:


Flannery, Martin
Molyneaux, James
Mr. David Stoddart and


Fletcher, Ted (Darlington)
Newens, Stanley
Mr. Max Madden.


Forrester, John
Noble, Mike





NOES


Armstrong, Ernest
Blenkinsop, Arthur
Braine, Sir Bernard


Atkins, Rt Hon H. (Spelthorne)
Boardman, H.
Brooke, Peter


Barnett, Rt Hon Joel (Heywood)
Boothroyd, Miss Betty
Brown, Hugh D. (Provan)


Bates, All
Bottomley, Rt Hon Arthur
Brown, Ronald (Hackney S)




Cant, R. B.
Janner, Greville
Rhys Williams, Sir Brandon


Cartwright, John
Jenkin, Rt Hon P. (Wanst'd &amp; W'dt'd)
Rifkind, Malcolm


Clarke, Kenneth (Rushcliffe)
Jones, Alec (Rhondda)
Roberts, Michael (Cardiff NW)


Cocks, Rt Hon Michael (Bristol S)
Jones, Barry (East Flint)
Rodgers, Rt Hon William (Stockton)


Cox, Thomas (Tooting)
Judd, Frank
Roper, John


Crawshaw, Richard
King, Evelyn (South Dorset)
Ross, Stephen (Isle of Wight)


Dalyell, Tam
Lamborn, Harry
Rowlands, Ted


Davidson, Arthur
Lawson, Nigel
Sainsbury, Tim


Davies, Rt Hon Denzil
Lester, Jim (Beeston)
Sandelson, Neville


Dewar, Donald
Luce, Richard
Sever, John


Dormand, J. D.
Lyons, Edward (Bradford W)
Shaw, Giles (Pudsey)


Douglas-Hamilton, Lord James
MacGregor, John
Sheldon, Robert (Ashton-u-Lyne)


Duffy, A. E. P.
McGuire, Michael (Ince)
Silkin, Rt Hon S. C. (Dulwich)


Durant, Tony
Maclennan, Robert
Smith, John (N Lanarkshire)


Dykes, Hugh
Marks, Kenneth
Smith, Timothy John (Ashfield)


Eadie, Alex
Marshall, Dr Edmund (Goole)
Stanley, John


Ewing, Harry (Stirling)
Mates, Michael
Stewart, Ian (Hitchin)


Ford, Ben
Mawby, Ray
Stewart, Rt Hon M. (Fulham)


Forman, Nigel
Meyer, Sir Anthony
Summerskill, Hon Dr Shirley


Gilbert, Rt Hon Dr John
Millan, Rt Hon Bruce
Thorpe, Rt Hon Jeremy (N Devon)


Golding, John
Morris, Alfred (Wythenshawe)
Tierney, Sydney


Goodhew, Victor
Morris, Rt Hon Charles R.
Tinn, James


Graham, Ted
Morrison, Hon Peter (Chester)
Viggers, Peter


Gray, Hamish
Moyle, Roland
Wakeham, John


Hardy, Peter
Murray, Rt Hon Ronald King
Walder, David (Clitheroe)


Harper, Joseph
Nelson, Anthony
Walker, Rt Hon P. (Worcester)


Harrison, Rt Hon Walter
Newton, Tony
Weatherill, Bernard


Hart, Rt Hon Judith
Normanton, Tom
White, Frank R. (Bury)


Haselhurst, Alan
Nott, John
Whitlock, William


Hawkins, Paul
Oakes, Gordon
Williams, Alan Lee (Hornch'ch)


Horam, John
Page, Rt Hon R. Graham (Crosby)
Woodall, Alec


Howells, Geraint (Cardigan)
Pardoe, John
Wrigglesworth, Ian


Huckfield, Les
Parker, John
Younger, Hon George


Hunt, David (Wirral)
Price, William (Rugby)



Hunter, Adam
Radice, Giles
TELLERS FOR THE NOES:


Hurd, Douglas
Rees, Peter (Dover &amp; Deal)
Mr. Peter Snape and


James, David
Rhodes James, R.
Mr. Jim Marshall.

Question accordingly negatived.

Original Question again proposed.

9.46 p.m.

Mr. John Biffen: That interlude emphasises some of the points made by the hon. Member for Newham, South (Mr. Spearing) in his strong protestation against a written constitution. I find myself profoundly in agreement with those remarks. They were inherently Tory remarks and a Tory analysis of our situation.
The hon. Member was quite right to remind the House that this evening's debate is part of a wider process, the process whereby this House is trying to determine what is the appropriate relationship between this country and sister European countries. That debate was not terminated by the European Communities Act, by the referendum, or by a decision to proceed with a directly elected European Assembly; it is a debate that will proceed and in which those who are determined to preserve the interests of national Parliaments as the forums for decision taking will count this evening as one of the darker hours. Even so, there will be those who will keep watch and who will record their votes, and who will hold in trust for the future the traditions of parliamentary

independence that we have inherited from the past.
In doing that, we shall be none the less good Europeans—if I may use a meaningless phrase—for what we shall be seeking to do is to establish the kind of institutions which we think should have primacy within the European Community, for if the European Community is to have a chance of success, it must be an organic and evolving institution.
The hon. Member for Newham, South was quite right to warn us against the chains that are made and fashioned from seeming paper constitutions, for if we consider the paper constitution to which we are committed, the Treaty of Rome, we find that it is now observed in the breach, in the sense that the Luxembourg Accord gives the right of national veto in terms which are totally contradictory to the provisions of the treaty. Yet we know that that is the safety valve without which the Community could not proceed. It seems to me that it is likely that it will be a safety valve and a device of increasing significance as the diversity of the Community is enhanced by the prospective membership of Spain, Portugal and Greece.
In that circumstance we are now being invited to make a commitment to a directly elected European Assembly,


for that is the purport of this evening's vote. A number of other significant issues, such as the remuneration of Members, have been raised, but the central issue is whether we are to make a commitment this evening. With the option before the House, in however unsatisfactory a form, shall we or shall we not consent to a directly elected European Assembly?
It seems to me that the central question is whether this is a natural and evolutionary development, likely to facilitate the happy reciprocal workings of a European Community, or whether it will add a point of developing discord. I believe that it will add a point of developing discord. I regard it as inherently artifical.
The first artificiality which strikes me is the extraordinary attempts now being made to cobble together some kind of political identity on transnational frontiers. I look, for eample, at the groupings of the Socialist parties within the Community. What sort of deliberations will take place within those groupings? I would say that the present courteous mutual debate between the Manifesto Group and the Tribune Group is as nothing to what will be the range of discord within the Socialist Group in the Europea Community.
Then I look at the Conservative Party, hawking around and trying to find allies of some sort or other—I shudder to think that they might be the Italian Christian Democrats—but, wherever I look, I ask myself the one simple central question: when it comes to the defence of exclusive fishing rights or to arguments in respect of the Milk Marketing Board, to what continental European parties do the Tories turn for sustenance and support? My bet is that they will find that most Christian Democrat parties of continental Europe will be more disposed to take an adversary role in respect of their interests as perceived by the Tories in this country, and, ironically, they will find themselves making common cause with the British Labour Party. It seemed to me that was precisely what happened over the Milk Marketing Board issue.
I say, therefore, that this is a contrivance, an artificiality. That is my first observation upon the directly elected Assembly—that it will place upon this country a dimension of total artificiality in its political relations with neighbouring

European countries through some attempt to contrive a confederation which will bind a series of national political parties. I say frankly that the Community is still a sufficiently tender flower as not to be able to afford the chill winds of that kind of artificiality.
The second cause for unease concerns the competition which, I believe, will come between a Continental Assembly with a direct mandate and national Parliaments, and more particularly our House of Commons.
There has been reference to the considerable funds that will be at the disposal of European Assembly Members. I do not particularly wish to take part in that controversy. I do not believe that money will purchase loyalties. Patronage helped to contrive the Union between Ireland and Great Britain, but patronage could not survive the onslaught of the Roman Catholic Irish population throughout the nineteenth century. Neither do I believe that one can fashion some European loyalty which will override national loyalties, unless there is a popular will and desire for it.
Into this situation I see interposed the dangers of a directly elected Assembly wanting to reinforce its already established spending power. Secondly, I believe that a directly elected Assembly will wish to enter into some kind of partnership with the Commission to try to establish the fact that the Assembly and the Commission have enhanced powers, to the detriment of the Council of Ministers answering to their national Parliaments. Such a development, in the context of prospective enlargement, is foredoomed to failure.
Given that analysis, I cannot believe that it will be in the long-term interests of those who want to promote a working Community partnership that we should proceed with a directly elected European Assembly. If this House has to make the gesture, so be it: we should not be so unsure of ourselves that we shrink from making the gesture and carrying on the fight—for I believe that we do so on a far wider range of interests than are immediately represented here.
Although I have no doubt that when the vote is held this evening it will be one more that will go the Government's way, those of us who will be in the


Opposition Lobby will be carrying forward the argument knowing that time is on our side—and that we will win.

9.56 p.m.

Mr. John Roper: The hon. Member for Oswestry (Mr. Biffen) has been a consistent opponent of the process of European integration, so his speech can have come as no surprise to the House. But there was one part of it with which I agreed. It is, of course, not surprising that it is difficult to create transnational political parties. That process will take time. The surprising thing is that they have gone so far along the road to their creation.
Inevitably, there are many issues in the European Parliament—as there was a week or two ago over the Milk Marketing Board—in which national interests override the interests of political parties. But there are also regular occasions—this week is a good example—when party political interests clearly override divisions between Members from different countries.
I have in mind the hearings which will take place tomorrow in Brussels on human rights in Argentina, which were determined by the Political Committee of the European Parliament and which then, by some parliamentary device, were boycotted by the non-Socialist parties. Thus, the Socialist Group, including my hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) will be taking an active part in those hearings.
Clearly, in such matters party divisions are far more important within the European Parliament than divisions at national level. We shall see in future a number of issue in which party interests will outrun national interests, but that process will take time. As the hon. Member for Oswestry said, it is not surprising that there is difficulty, particularly on the Conservative side, in finding a party with which they can form a group.
There have been a number of debates on this subject, and this will not be the last. As the hon. Member for Mid-Oxon (Mr. Hurd) said, we shall still have to have debates on the order laying down the details of the electoral procedures and of the boundaries, later in the year. But those debates will be matters of detail. Tonight is the last debate on the principle of direct elections.
Since I have been somewhat experienced in earlier debates, I feel that this is a useful occasion on which to start by declaring a non-interest. If one starts to discuss the salaries of Members of the European Parliament, one is frequently interrupted and asked what one's intentions are. I therefore begin by declaring a non-interest.
The hon. Member for Banbury (Mr. Marten) discussed at length the problem that might arise if a Member of the European Parliament were of a different party political complexion from a Member of this House. In rural Oxfordshire it may be unusual to have a local authority of a different political complexion from that of the Westminster Member of Parliament, but in other parts of the country we frequently have situations in which the local authority is Conservative-controlled but the local Member of Parliament happens to be Labour. We have known for some time that representatives at different levels of government—

It being Ten o'clock, the debate stood adjourned.

BUSINESS OF THE HOUSE

Ordered,
That the Solomon Islands Bill [Lords] may be proceeded with at this day's sitting, though opposed, until any hour.—[Mr. Frank R. White.]

Orders of the Day — EUROPEAN COMMUNITIES (TREATIES)

Question again proposed.

Mr. Roper: I do not see that any greater problem will arise in the case of the European Parliament than arises, for example, with members of local authorities who belong to various political parties.

Mr. Buchan: Does my hon. Friend mean what he is saying? Is he saying that the conflict between the local authority with a clearly defined ambit of interest and the interests of a Member of Parliament is comparable with the situation in an elected Assembly? Is he suggesting that such an Assembly, if it seeks to dictate to the Council of Ministers, which is also responsible to native Parliaments, will create a conflict?

Mr. Roper: My hon. Friend was not present when the hon. Member for Banbury spoke. I was referring not to a conflict between this House and the European Parliament but to a conflict in a locality between a Member of the European Parliament and a Member of the Westminster Parliament if those Members happened to come from different parties. I do not believe that the fact that people come from different parties in the same geographical area need create the terrible problem highlighted by the hon. Member for Banbury. I know that in one's own area in debates on educational and housing policy one often finds that one is in conflict with people of another party who are locally elected as councillors in the area. I do not think that the suggestion made by the hon. Member for Banbury is either a novelty or such a difficulty as he suggests.
We must also consider the subject of remuneration. It is important to note that not until there has been a decision from this House, and not until the Nine have ratified the legislation, will the Council of Ministers consider a proposal under article 13 of the treaty. Therefore, it is important to obtain a ministerial assurance on the subject of United Kingdom taxation. The Government have given a fairly clear indication on that point, but we should be given further clarification.
I hope that the Minister will also comment on the proposal that the salary of Members of the European Parliament should be varied in different parts of the Community according to the cost of living. That proposal would go a long way to meeting the obvious discrepancies that would exist if the same salaries were paid throughout the whole of the Community.
Alternatively, it is not unreasonable, until we reach a common system of election for Members of the European Parliament, for such people to be paid on the same basis as Members of their own national Parliaments with appropriately monitored and scrutinised expenses. I hope that the Minister will make some comments about this.

Mr. David Stoddart: On what basis does my hon. Friend think that a member of the European Parliament should be paid the same amount as a Member of this Parliament is paid? Members of the European Parliament will

have no constituency responsibilities and will probably work a couple of days a week, and that will be the end of their task. Does he believe that such a person is as worthy of being paid as much money as a Member of this Parliament?

Mr. Roper: My hon. Friend suggests that Members of the European Parliament will have no constituency responsibilities. Perhaps they will not. But that was not the point of view of the hon. Member for Banbury. So, on the one hand we are told that Members of the European Parliament will be interfering in our constituencies too much by being, in effect, second Members of Parliament, and on the other hand we are told that they have no constituency duties at all. I believe that if they have constituencies as large as those suggested by the Boundary Commission they will indeed have fairly heavy constituency responsibilities, perhaps each of them covering an area comprising seven or eight Westminster constituencies.
My hon. Friend's constituency of Swindon will be in the Upper Thames constituency of the European Parliament, and even if his constituency is excluded from the activities of the Upper Thames Member of the European Parliament that Member will still have six or seven other Westminster constituencies to cover, so he will be reasonably busy. The suggestion that Members of the European Parliament will have no constituency responsibilities should be closely examined.
Perhaps the point about comparability between salaries should be referred to Lord Boyle and his committee. Nevertheless, one might start on the approximate basis that it would be reasonable for Members of the European Parliament to be paid at about the same level as Members of the various national Parliaments.
I was interested to hear what my hon. Friend the Member for Newham, South (Mr. Spearing) had to say about the debilitating effects on politics of the direct elections. He posed a problem that a number of us have considered. If he rereads the speech by my right hon. Friend the Foreign Secretary to the Brussels Labour Club, he will see that my right hon. Friend talked about debilitating effects as being effects of the past. My right hon. Friend went on to refer to the Prime Minister's letter to the general


secretary of the Labour Party and the new basis for discussion and co-operation within the Labour Party on this matter, and suggested that although there might have been a debilitating effect in the past, there would not be in the future.

Mr. Spearing: I emphasise that I accept that my right hon. Friend the Foreign Secretary was speaking about the past and not about the future. I tried to point out that I thought that the future in respect of direct elections would indeed cause that fear. My hon. Friend has referred to the Prime Minister's letter to the NEC of the Labour Party. A lot will depend on what emerges from that. It may well be that if certain things do not emerge, debilitating effects, at least on the Labour Party, will, unhappily, continue.

Mr. Roper: I do not want to get involved in a medical debate on those matters which may or may not debilitate the Labour Party. I believe that the Prime Minister's letter provided the basis for constructive and useful discussion within the party and that we have now seen some of the first signs of that in the activities of my right hon. Friend the Minister of Agriculture, Fisheries and Food in Brussels.
I suggest that the important positive effect of direct elections will be to focus attention both within the political parties and between them on the issues of Europe. All too often we have to listen to speeches by those who say that we are obtaining European integration by stealth and trying to achieve it clandestinely. One way in which we shall avoid doing it by stealth is by ensuring that there is public debate among our people every four years on these issues. The four-yearly direct elections will ensure that the issues are presented to the electorate and that those opposed to further stages of integration will be able to put their points of view, just as those holding the opposite points of view will be able to put theirs.

Mr. J. W. Rooker: Does the encouragement of public debate every four years extend to the nobbling of the media in which my hon. Friend and the hon. Member for Mid-Oxon (Mr. Hurd) are involved in selling direct elections as a media issue by seminars to representatives of the media

throughout the country? I have raised this matter before because their correspondence was made available to me.

Mr. Roper: I am grateful to my hon. Friend for intervening on that point. I am, of course, pleased that organisations of various sorts are trying to ensure that the media inform the British electorate. We have debated these matters in the House before. I am pleased that the BBC is to give proper attention to this matter and will develop a Euro-service later in the year, so that people can be fully informed on these issues. I believe that these issues will be of importance, and I am not in any way ashamed of the activities of organisations such as the European League for Economic Co-operation in promoting such study and understanding.

Mr. Marten: Is the BBC intending to broadcast the proceedings of the European Assembly? If so, in what language will it be?

Mr. Roper: I have no idea whether the BBC is to broadcast the European Parliament. I hope that it will. I understand that there will be a translated version in English for those who do not want to listen to other languages. But that is not a matter for this present debate. My point is that the BBC has said that it will be introducing some form of Euro-service later in the year. This matter was debated on an earlier occasion when my hon. Friend the Member for Newham, South raised it.

Mr. John Evans: My hon. Friend has raised a fascinating point as to the issue of European integration, economic and monetary union and so on being placed before the people every four years at elections. The presumption would appear to be that the candidates will be pro-Common Market or anti-Common Market. If there are Labour candidates who are pro-Common Market, Liberal candidates who are pro-Common Market, and Conservative candidates who are pro-Common Market, there will be no choice. Is he suggesting that the Labour Party, which is basically an anti-Common Market party, should put up anti-Common Market candidates?

Mr. Roper: I think that this point was dealt with very adequately by my hon. Friend the Member for Islington,


South and Finsbury (Mr. Cunningham) in an earlier debate when he said that perhaps these elections should take place between fast Europeans and slow Europeans. My hon. Friend the Member for Newton (Mr. Evans) is, I think, simplifying matters when he refers to anti-Common Market and Pro-Common Market people. I think that he would agree, on consideration, that there are many people who may have been opposed initially to British membership of the Community but who, none the less, believe that, having gone in, we ought to stay in and see what can be done that is useful. There are others who say "Let us integrate as fast as possible." The vast majority of people, I believe, are somewhere in between.
I think that in the debates leading up to direct elections we shall see a focusing of attention on these issues and a gradation of positions between the political parties on the issue of integration as well as on the much more important issue of the sort of Europe they want to see and the sort of values they want to see adopted within the European Community.
I feel, therefore, that it is of great importance that the House should give a substantial majority to the order tonight, so that the Government can go ahead and ratify the treaty and so that the necessary progress can be made to enable direct elections to take place, as planned, on 7th June next year.

10.14 p.m.

Sir Anthony Meyer: I am not quite sure whether I agree with the hon. Member for Farnworth (Mr. Roper) that the divisions within the European Parliament will be along party lines. On the other hand, I hope very much that they will not be along national lines. I believe that great issues will emerge. One great issue in particular which will provide the dividing line within that Parliament will, I believe, be that of protectionism. I believe that this will be the great argument within the European Parliament.
Perhaps I should begin, Mr. Speaker, by saying that I am not, and in no circumstances will I be, a candidate for the European Parliament. That, I hope, puts me in some position to regret the stress which my delightful and hon. Friend the Member for Banbury (Mr. Marten) invariably puts in his speech—which we have heard a good many times now—on the pay and allowances to be awarded to the Members of the European Parliament. Frankly, when he bases the bulk of his case—at any rate, in terms of column inches—on this one issue, I do not think that he does himself justice.
My hon. Friend the Member for Banbury, like my hon. Friend the Member for Oswestry (Mr. Biffen)—whom I am sorry not to see in his place—is a hopeless romantic. He is a hopeless romantic rather like those other delightful hon. Members—who are not present tonight—of Plaid Cymru. I really think that they believe in an independent Wales, knowing full well that an independent Wales may be proud, but, my goodness, it will be poor. Knowing that, they continue to proclaim their faith. In doing so, they differ very substantially from the Scottish National Party, which believes that an independent Scotland will be a very rich Scotland and to hell with the rest of the United Kingdom.

Mr. Marten: I think that the difference between us is not whether one of us is a romantic. The thing is that I believe in the ability of my own country to survive, whereas my hon. Friend does not. That is all it is.

Sir A. Meyer: I shall be coming to that point at the end of my remarks. Perhaps my hon. Friend will allow me to

make my speech in the order in which I composed it rather than deal now with the point that he has just raised.
I like romantic idealism. Although I disagree with my hon. Friend, I can find something to admire in his attitude. I find it very much more difficult to admire the attitudes of Labour Members who reject the idea of closer co-operation in Europe, in particular their rejection of the concept of democratic control through an elected Assembly. I find it very difficult to admire anything in Socialism. If, however, there is one thing which commands my reluctant admiration, it is the concept of Socialism as an international brotherhood in which a foreigner is as good as an Englishman and we are all human beings together. I find the emergence of what I can only call a national Socialism on the Left of the Labour Party, and also among respected figures in the Centre of that party, a deeply disturbing phenomenon.
My hon. Friend the Member for Banbury asked whether the European Parliament was the first step on the road to a federal Europe. [Hon. Members "Yes."] I must answer that by saying "Alas, no, it is not." But it is the first step towards providing that leadership which the other members of the Community have looked for in vain to this country. Ever since the Community was first formed, its progress has been held back by a longing for this country to come in and take its place as the leader. [Hon. Members: "Arrogance."] The Germans, who by virtue of their economic strength, had every right to claim that position, held back because of memories of what had happened 30 years ago. They were very ready to allow us to set the example.

Mr. Nick Budgen: What about the Frogs?

Sir A. Meyer: What my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen) refers to so eloquently and elegantly as "the Frogs" were themselves very ready to accept lessons from this country in how an elected Assembly could provide effective control over an Executive.

Mr. John Evans: Does the hon. Gentleman accept that it is arrogance of the sort which he has displayed which makes


the rest of the Right-wing parties in Europe want nothing whatever to do with the British Conservative Party?

Sir A. Meyer: When I refer to leadership, I am not suggesting that this country is in any position to give orders or even to take the first place. I am suggesting that at the heart of the European Community from the outset there has been a gap. It has been an agreement among Governments. It has achieved closer relationships among people. It has lacked democratic institutions of control.
This country, with its thousand years' history of parliamentary democracy, was surely the country to supply exactly that. That is what we have conspicuously failed to provide up to now. That is what the proclaimed democrats of the Labour Party would try to deny even at this last stage. Where else does this country pretend to supply the leadership in question? Is it in matters of social services? When we first talked about joining the European Community, there were many areas in which the British social services were in every way superior to those available in the European Community countries. That is no longer so.
Does this country pretend to supply the leadership in matters of industrial production technology or new inventiveness? That is only very dubiously so today. Is it in our capacity to defend ourselves and to take the lead in the defence of Europe, as we did in the last war? I doubt whether the events in Africa during the past few weeks have lent much encouragement to that point of view.
However, it is even now open to this country to play a decisive role in ensuring that the Community develops institutions which enable the people, through their elected representatives, to influence, perhaps decisively, the way in which the Community develops.
I believe that the world is moving into a very dark age. I have only limited confidence in the ability of the industrialised world, whether Communist or non-Communist, to find a satisfactory answer to the problem of structural unemployment. I fear that the events that are now taking place in Africa will fuel racial conflict throughout the world. I do not believe that the kind of world to which we are moving at a frightening

pace is one in which a single nation State, however proud and self-confident, can hope to survive on its own.

Mr. Marten: Japan?

Sir A. Meyer: Most certainly not. The question is whether the European Community can survive in this kind of world. The question was asked—and was not answered—in an article in The Sunday Times at the weekend by Keith Richardson in which he spoke of the impact on the Community of the growth of competition from low-cost countries. That is why I referred at the beginning of my remarks to the issue of protectionism, which will be the dominating issue in the debates within the Community in the years ahead.
In the kind of world that is coming, it will not be possible for single nations to survive, to defend themselves, to ensure a decent standard of living for their people and to secure a reasonable level of employment, even by the most Schachtian policy of protection. Because of that, I am convinced that it we visionaries, who believe in the possibility of achieving an integrated Europe in which an elected Assembly has a major role to play, who are the realists. As to those who tell us that a single nation State can conceivably survive in those circumstances, their is the realism of Lilliput.

10.25 p.m.

Mr. Norman Buchan: I must say that I find a strange disharmony between the argument of an hon. Member who describes himself as a visionary and an idealist and the concept he advances of the creation of yet another bloc, on the grounds that we shall otherwise have insufficient technological powers. This is not the kind of vision to which I particularly look forward.
I have to say to the hon. Member for Flint, West (Sir A. Meyer) that, while he has tried to deny some of the patriotic expressions that we have heard in the House this evening, he has been guilty of arrogance in the way in which he propounded the view that the whole of Europe was waiting for every word of leadership that might be hanging on our lips. That is nonsense. It is not only inaccurate now it was inaccurate 30 years ago, as those of us who were in


Europe at that time know. I do not think that we can look for visions and ideas in that direction.
My hon. Friend the Member for Farnworth (Mr. Roper) raised the question of conflict. It is a real issue. It is no use saying that we are accustomed to conflict and, therefore, another kind of conflict may not be serious. This House depends upon conflict. Within our parties, ideas emerge from conflict. We understand this. But there is a difference between conflict which produces ideas and conflict which arises because the functions are coming under different authorities.
The conflict that my hon. Friend describes between a Member of Parliament and his local authority does not arise because someone makes the decisions in the housing committee. It arises because he argues and protests, sometimes, about the decisions made in the housing committee. This is an argument involving ideas and concepts, sometimes conducted publicly. It is not an argument in which the Member has a function to perform. The seriousness of the conflicts which we envisage in relation to Brussels arises from the fact that such an Assembly will have a say and a responsibility a direction in relation to the functions of the Commission and the Council.
We too, in this House, have that kind of responsibility, directly and by vote, for the functions of our Ministers who appear in the Council. That is a different kind of conflict. It is not a creative conflict. It is not the conflict that arises from the normal argy-bargy of political discussion. It is a conflict arising from confusion as to who controls the same set of functions.

Mr. Roper: My hon. Friend is absolutely right on this point. The point I was making concerned the conflict which might occur within the constituency. Nevertheless, there will be creative tension between this House and the European Parliament.

Mr. Buchan: With respect, I would prefer to use the expression "creative tension" to describe the relationship between a Member and a local authority rather than the relationship between ourselves and the Assembly. The other is not creative tension but a destructive conflict.

My hon. Friend earlier said that the conflict which he was dealing with involved the possibility of conflict between a local constituency Member and the Assemblyman. My hon. Friend the Member for Swindon (Mr. Stoddart) dealt with that rather smartly when he said that no Assemblyman would deal with his constituency. My hon. Friend the Member for Farnworth said that there would not be a conflict if the Assemblyman for the area was of a different political complexion from the Member of Parliament. I do not think that that is true. This is bound to lead to the kind of involvement and interference I have described earlier. I do not accept that point.
I want to make my main point the argument over what was called the debilitating effect upon our political institutions. I make no apology for being a party man. I join a party to try to combine with others of a like mind. When they are not sufficiently alike, I try to convince them that my interpretation and viewpoint are right.
I see no other way by which we can change society, except through party politics of this kind. The alternative to party politics is not this great panacea of the individual Member voting. It is, on the contrary, the closed conspiracy. Not only our politics but our society will be debilitated if that is to be the replacement for open party politics.
By having an elected Assembly, we are immediately moving past two milestones in the same direction. The first milestone is that an elected body immediately seeks power. It has power by the very process of election. It is no use saying that our Parliament alone will control our Ministers on the Ccl when we have elected Members in Europe. If they have no power, they will immediately seek power. All bodies seek power, and impotent bodies will seek absolute power.
The second milestone is that the politics immediately will begin to change, because the next great conflict is involved. That conflict will be based not upon politics but upon national attitudes as decided by the political complexion of this House, and which should continue to be expressed by Ministers, and the political complexion that will develop in such an elected Assembly.
The search will be on for Members of the Assembly to create their own political


pattern, their own political groupings and their own political parties. But the political parties that will emerge from a combination of 10 States, each with its own traditions, background, phases of development and particular trade union or political awareness, will be different within the Socialist movement or within the Right wing of these political parties. But either of these will be different from the requirements of a Right-wing or Left-wing party in this country which arise from the particular conditions of Britain in this particular year and with the centuries of background that have created them. That is the kind of difficulty.
The politics of the Assembly will immediately become different in an institution which is now demanding power and which will exact power over the most powerful instrument in Europe, as it will become—the combination of the Council and the Commission. The pattern that will be imposed on this bloc will be a very different pattern, and what will emerge from it is the second milestone along the road—the inevitable drive towards federalism.
Such an Assembly, having now established its own political pattern and its modus vivendi for operating this political pattern, with control over the Council, will find that the next logical step is, of course, a federalist Europe. There is no other way. The only other way is that it remains permanently impotent. If it does that, it is an artificial creation and the sooner we drop it the better.
I do not believe that it will remain impotent. I believe that it will develop and achieve power, and that that power must express itself in a federalist Europe. It cannot be disputed that, whatever else the people of Britain voted for in the referendum, they did not vote for a federal Europe with one basic elected institution to control the effective governing body—the Council that will emerge and the Commission that will work with it.

Sir A. Meyer: I have been listening closely to the hon. Member, and, as he knows, I take a diametrically opposite point of view from his. Can he explain how a directly elected Parliament will bring about this federalism of which he complains, unless it is in the position to

make or unmake the government of Europe. It cannot do that unless the Council of Ministers gives over its power to the Commission. That cannot be done without a fresh treaty, and that treaty cannot be achieved without a national veto.

Mr. Buchan: Ever since the hon. Gentleman's Government took us into Europe, we have been fighting to try to control our own Ministers in Brussels. That has been the process over the past half-dozen years. Within a short period of entry, we are still fighting to regain control. Time after time the answer we get is "Yes, we may discuss these matters tonight". A motion may be passed to the effect that the House takes note or rejects, but that will not stop its coming into law.
European law already has supremacy over British law. That is a process that will take place in many areas. That process will sharpen because in the Assembly and in this place there will be those who wish to move in that direction. There will also be the argument in the national parties to move in that direction. No one will produce a resolution in the European Parliament next week to the effect that it will have absolute power and control over the Council and the Commission. We know that, but that is why I talk of inevitable progress in that direction. I cannot see anything that can block that inevitability.
I turn to the Act that we did not have in front of us when we embarked on this the most crucial of our discussions on these matters. It may be that it will be the last of these discussions. I hope that it will not, but in any event it is a black day for democracy in this country. I have been loaned a copy of the Act. As I have said, when the debate started copies were not available. Article 4 refers to the European Assembly Members. It states:
Representatives shall vote on an individual and personal basis. They shall not be bound by any instructions and shall not receive a binding mandate.
What we are being asked to approve? A binding mandate from whom? What is
an individual and personal basis"?
Is a man to stand in the European elections, whether for the Cotswolds or for Upper Thames, an area of 600,000 people, and say "Vote for me. However, I


accept no mandate from you and towards me"? Is that what is being said?
I accept party politics. I am a party man. The alternative is the closed conspiracy. If we have an Assembly that is based upon those who by statute or by law recognised and accept no mandate of any sort, that can lead only to the closed conspiracy in the politics of Europe. I regard that as highly dangerous. I want the Member of Parliament to act in an individual and personal way, and part of that is the voluntary surrendering to and acceptance of the party structure that is open and avowed around him.
Members of Parliament often have to behave as individuals. It gives me no great pleasure when I have to vote against my own Government, as I had to do earlier this evening. It is right that it should be difficult for us when we wish to act against our own party. Were it not so, we should move into the situation that I have described of closed groupings rather than an open Parliament. However, it seems that Article 4 is writing in that Assembly Members shall be responsible to no one. I cannot accept that.
Are we being asked to vote for that? That is what is in front of us, although I did not have available to me a copy of the document when I entered the Chamber. Whether it is written into the British constitution or whether it is not, we all recognise that there is a bond and a mandate between us and our electorates, between us and our open party for which we have campaigned, between us and the statements that we have made during the election, and between us and the manifesto on which we have commonly fought.
That which is before us is a negation of democracy and a move towards closed conspiratorial politics.

Mr. Jay: What would happen if one of the Members of the Assembly, having been elected, announced that he did not propose to accept the position as laid down? Would he be automatically disallowed from taking his place?

Mr. Buchan: It seems that that should follow. It is a pretty powerful "shall". It is not stated that representatives "may". Anyone who has been in the Scottish Grand Committee will know that

we can spend weeks discussing the difference between "may" and "shall". This states that
Representatives shall vote on an individual and personal basis.
I reject that.

Mr. Kenneth Clarke: I am grateful to the hon. Gentleman for giving way so soon after a sympathetic intervention. I am trying to follow his argument, though he dropped to hushed tones because he was so shocked by his discoveries in the document of which he said he could not obtain a copy only an hour ago. Is he so shocked to discover that there is no legal constraint on a representative in the European Parliament to accept a mandate? Does he not realise that he is under no legal or statutory constraint to accept a mandate in this House? Once elected, he comes here as an individual. He is, of course, under the ordinary democratic restraint when he seeks re-election of having to answer to his electorate for those things that he said when he was elected. All that he is describing in these shocked and ridiculous terms is precisely the same legal and constitutional position as a Member of the Westminster Parliament.

Mr. Buchan: I do not mind the length of the intervention, but I resent the obtuseness of it. If the hon. Gentleman had listened to my argument, he would have realised that I was dealing with the unwritten acceptance of mandate between the electorate and Members. None of us would dare to stand for an election on a manifesto which said "Vote for me, but when I get to Parliament I shall vote on an individual and personal basis and shall not receive a mandate."

Mr. Hugh Dykes: Will the hon. Gentleman give way?

Mr. Buchan: No. The second consequence of this article is the recognition of the difficulties of Members going as representatives of a nation and of political parties. Because that problem has been incapable of solution—I fear that for many years it will be insoluble—this aspect has had to be written in.

Mr. Dykes: I am obliged to the hon. Gentleman for giving way, because he has given way twice in quick succession. Is he not exaggerating in an over-dramatised form the supposed dangers arising from his own abstruse theorising


on a political notion which in practice will not obtain? Does he agree that all he is saying is that a national Member of Parliament has, in effect, more than one hat in that he is to some extent not only a party person but an individual elected constitutionally in his or her own right? In the same way, a European MP would be elected with more than one hat. In the election campaign, would not the normal political constraints that oblige a Member to seek re-election in due course and his party adherence clearly manifested before election come out in a natural way for the most sophisticated electorate to grasp?

Mr. Buchan: My argument was linked to my opening argument in analysing the relationship between the party, this place, the Assembly and the Commission. I suggest that if the hon. Gentleman looks at my speech tomorrow, he will see the connection.
I return to the debilitating effect, to pick up the phrase used by my hon. Friend the Member for Newham, South (Mr. Spearing), on political strategies. But there is a further debilitating effect to be looked at if we have now moved along the road towards federalism. It is an artificially created federalism—a federalism brought about in the guise of the joining together of the mutual interests of a number of nations still dominated by the political controls, checks and bounds of native countries. But society changes. When the shift of political consciousness, of economic development and of history reaches a certain point, change occurs. When a number of nations with different traditions, different periods of development, different balances in economic strategies, different political experience and different forms of democratic controls join together, such a structure tends not to enhance the possibility of social advance and change but to inhibit the inevitable development of social change in those countries. It is in the inhibiting effect of the bureaucratic, artificially created Common Market that the final error lies. It is for that reason that I hope we shall seek to reject the order tonight.

10.45 p.m.

Mr. Hugh Dykes: An hon. Member on this side and another

on the Government side described this as a dark day, or dark evening, because of the subject. It has been a dark evening not only for literal reasons but for different reasons from those contained in earlier remarks.
We have had the depressing manifestation, particularly below the Gangway, of hon. Members who conjure up all types of terrors and anxieties about a development that repeatedly has been welcomed widely by the House in substantial votes. Those votes show that direct elections are the will of the House. That is not the same as saying that hon. Members who are in favour of direct elections and, therefore, of ratification by the passing of the order, wish to inhibit, limit or reduce the arguments of minority who have been against direct elections.
In the context of all the debates that we have had and all the documents that have been issued, it is depressing that none of the arguments from below the Gangway and elsewhere is new or succeeds in arousing anxieties in the electorate. The electors seem to be more sophisticated than most of their elected representatives in that part of the House. They have been deprived of sufficient information on the subject, but they seem to be more sanguine and more willing than those hon. Members to accept this development, which is to some extent a political experiment.
I do not say this in an arrogant spirit or in a dismissive sense, but the House should have had a fairly routine debate. The substantial Act which was given Royal Assent on 4th May has been debated at great length when compared with any other measure, except perhaps the devolution measures for Scotland and Wales. Yet again and again we hear repetitions of the tired old canards and the absurdly defeatist and chauvinistic arguments, mainly from hon. Members below the Gangway who have terrors and fears in their minds which do not afflict other people.
It is dangerous and misleading for them to speculate in narrowly defined channels which, by the nature of the future existence of the Community, let alone the European Parliament, are unascertainable by definition, as is the future itself. They are not remotely likely to result in the awful dangers that are conjured up in those hon Members' minds.

Mr. Leslie Spriggs: The hon. Member referred to the terror felt by hon. Members below the Gangway. There are two terrors. The first is the increased cost of living which affects the housewives of this country and the Community. The second is the terror of the House of Commons becoming lobby fodder to the European Parliament.

Mr. Dykes: I cannot accept the remote danger of the latter part of that intervention. These economic problems which affect housewives and others in this country can be solved only jointly. I believe that direct elections are a vital part of the whole exercise. The concerted action by the Council of Ministers on economic policy, which I presume the hon. Gentleman favours in view of his comment on prices, can be supported only by an energetic and directly elected Parliament.
I would never have favoured direct elections along the lines we now anticipate, depending on the future shape of the Parliament and on its relationship to the Council of Ministers, if I had thought that the House of Commons would in any way be weakened thereby. I do not accept that it will be. We have always been proud of the intrinsic strength and great resourcefulness of this Parliament, but it has, by sheer force of circumstances in terms of the Executive, the powerful machinery of government and all the world economic forces that are making life very difficult, if not intractable, for us and the other member States, been made into a weak Parliament. That is a much more important factor for this House to tackle than the abstruse theorising about the nineteenth-century doctrine of intrinsic parliamentary power which all hon. Members know in their hearts, but will not admit, no longer obtains.
There are then the supposedly awful high rates of pay that, according to speculative articles in The Economist, European Members of Parliament will receive. There is no evidence or proof to back up those articles. No final decisions are anywhere near being made. There has been no real discussion of the matter in the European Parliament or elsewhere. The final decision will rest with the Council of Ministers. But are not hon. Members indulging in a severe form of

hypocrisy? They, certainly privately but perhaps even publicly, admit that the British parliamentary salary is too low, given the amount of work involved and the relativities of our society. Whatever the ultimate figure for European Parliament salaries, it should be at a realistic but not excessive level given the work involved. Deliberately to try to distort the facts on that matter and to try to mislead public opinion is wrong.
This order should be entirely routine, although I do not suggest that the procedures for scrutinising EEC instruments in this House is other than unsatisfactory. I believe that that is common ground to both pro- and anti-Marketeers.
Surely this House now has the experience, knowledge and necessary self-confidence on the subject of direct elections to proceed tonight expeditiously to approve the order with, if there is a vote, which I hope there will not be, a substantial majority to show once again the continuity and consistency of the will of this House to vote for the European Community and its future institutional development.

10.53 p.m.

Mr. Ted Leadbitter: We began this important debate by addressing ourselves to the fact that the House was unable effectively to debate this serious issue in the absence of the relevant papers. The Minister, in an attempt to try to put the matter right, indicated that the papers were available 18 months ago but that publication of them had been exhausted. He certainly used the word "exhausted". I therefore went at once to the Vote Office.
There has been a great deal of discussion recently about the position of the United Kingdom in Europe, about our ability or inability to lead. But can we say to our electors that tonight we are well enough informed on this matter to vote when we have not studied those important documents?
When the vote on the motion to adjourn the debate took place, I was rather appalled to find that hon. Members were apparently being ushered into particular Lobbies for reasons which I had not heard in the House. Therefore, that again is a measure of the intensity of quickly-called lobbying to force a voting complex on an issue that is important


to the United Kingdom, and it was out of all keeping with the tenor and concern of hon. Members who had been involved in the debate prior to the motion to adjourn it.
During a point of order, the Minister, quite rightly, indicated that a paper had been drawn up which was described as the explanatory memorandum. To say the least about that, it is brief. As far as I am aware, after listening to the debate with care, it leaves out a good deal of information. This document does not satisfy the needs of those of us who are concerned about the issue.
However, one of the sentences in the introductory paragraph is pertinent. The preamble, as it were, states:
The Instrument specified in the Schedule to this Order
that is, the order that we are debating—
is the Act concerning the Election of the Representatives of the Assembly by Direct Universal Suffrage, taken with the Decision of the Council of the European Communities of 20 September 1976 to which it is annexed. (Command 6623.)
I went immediately to the Vote Office when the Minister had indicated that certain publications had been exhausted, although bearing in mind that my right hon. Friend the Member for Battersea, North (Mr. Jay) had been patently honest with the House in indicating his attempts to get such a paper and other papers. I think that it was after five attempts that he had found it prudent to inform the House that he had got such a paper, after much effort, a very short time, I think, before the debate started. That was the position. But when I went to the Vote Office, I was informed that this Command Paper—I use the words addressed to me—"is quite beyond us."
I want to cast my vote tonight. I place myself no higher and no less in importance in that matter than any other right hon. or hon. Member. I do not go so far as to say that I am more informed than some hon. Members who have spoken consistently on these matters. But I am not prepared to say that I am uninformed. I am sufficiently aware of the significance and the importance of the debate to the United Kingdom.

Mr. Spearing: I think that my hon. Friend will wish to place on record that the knowledge of his colleagues is that

this is no fault of those who run our Vote Office or who deliver the Vote to us. I see that my right hon. Friend the Member for Battersea, North (Mr. Jay) agrees with that. However, does my hon. Friend agree, therefore, that it was the Government's fault in not ensuring that in placing this Statutory Instrument they also at the same time placed equivalent numbers of copies of the treaty and saw that they were distributed at the time?

Mr. Deputy Speaker (Mr. Bryant Godman Irvine): Although I was not in the Chair at the time, I am under the impression that these matters were fully discussed during discussion on the motion to adjourn the debate.

Mr. Leadbitter: Yes, I take the import of your advice to the House, Mr. Deputy Speaker. As always, I am not in a position to question it, nor do I wish to do so. The importance of this subject, however, is that the will of the House at this stage is such that it would not want observations of this kind of importance to be limited to a period prior to a vote on the motion to adjourn the debate. In the vote on whether the debate should be adjourned, we decided that it should continue.

Mr. Kenneth Clarke: Will the hon. Gentleman give way?

Mr. Leadbitter: No. I had enough of the hon. Gentleman last night.

Mr. Clarke: The hon. Gentleman would not give way then either.

Mr. Giles Shaw: rose—

Mr. Leadbitter: No, I will not give way. I will give way to any right hon. or hon. Member who claims to understand what we are talking about and who has some record of being honest with the House of Commons—and last night the hon. Member for Rushcliffe (Mr. Clarke) was not.

Mr. Deputy Speaker: Order. May I offer a little further assistance to the hon. Gentleman? The decision which the House took a short time ago was that we would return to the original motion.

Mr. Leadbitter: That is what I was saying, Mr. Deputy Speaker. The outcome of the vote on whether the debate should be adjourned means that we now continue with the debate on the original


motion. I have the right in the House to refer to the lack of papers.

Mr. Kenneth Clarke: Will the hon. Gentleman give way on that?

Mr. Leadbitter: No. The hon. Gentleman must understand that unless he is prepared to come to the House following the debate that we had last night and withdraw his untruthful remarks, I shall not give way to him.

Mr. Deputy Speaker: Order. I am under the impression that I heard the hon. Gentleman talk about "untruthful remarks". I am sure that, on reflection, he would not wish to leave the record in that way.

Mr. Leadbitter: So far as I am concerned, the word "untruthful" is not unparliamentary language. I am prepared to come to the House on another occasion on this matter in order to fall in line, Mr. Deputy Speaker, with the temper of what you are suggesting. Last night, in another situation, the hon. Member for Rushcliffe was challenged on the very point—

Mr. Deputy Speaker: Order. It is not very profitable to pursue a matter which was discussed last night. Perhaps the hon. Gentleman will come back to the motion which is now before the House.

Mr. Dykes: On a point of order—

Mr. Kenneth Clarke: On a point of order—

Mr. Leadbitter: It is this, Mr. Deputy Speaker—

Mr. Clarke: On a point of order, Mr. Deputy Speaker. I understood you to invite the hon. Member for Hartlepool (Mr. Leadbitter) to withdraw the suggestion that I made untruthful remarks at any stage in the House. Last night, he did not withdraw those suggestions. He was not present when I made the remarks that he claimed were untruthful. I ask you to say that it is unparliamentary language to persist in making such allegations about remarks which the hon. Member never even heard in the first place.

Mr. Leadbitter: I have accepted your invitation, Mr. Deputy Speaker, to continue with the debate—and that I now propose to do.

Mr. Dykes: Will the hon. Gentleman give way?

Mr. Leadbitter: Coming back to the question of the papers which are not available to us, my hon. Friend the Member for Newham, South (Mr. Spearing) asked me to make it clear that the responsibility does not lie with the Vote Office. I confirm that. Having made it clear that, without these essential papers, the House could not deal with this matter, I was about to deal with the second point.

Mr. Dykes: Will the hon. Gentleman give way?

Mr. Leadbitter: No, I will not. I have had plenty of interventions.
The second point is that it must alarm the electorate to know that time and again important matters relating to the Common Market are discussed in this House at a late hour—

Mr. Martin Flannery: Always.

Mr. Leadbitter: —when sometimes fewer than one-quarter of the Members can be present.

Mr. Flannery: It is deliberate, of course.

Mr. Leadbitter: I now want to express my concern about the United Kingdom's role in Europe—something that the hon. Member for Flint, West (Sir A. Meyer), in his visionary and romantic way, sought so dismally to describe.
I believe that not only did Europe not want us for long years but that it actually vetoed any steps to take us into Europe. I also believe that the idea of joining Europe did not emanate from a feeling that the rest of Europe was waiting anxiously for us to join. The Common Market was already in too much of a mess. It had fatuous argumentative sessions that went into the early hours of the morning. Even the simplest of issues could not be dealt with. Those of us who studied energy matters knew what a terrible situation had been created. The advantages went to the Soviet Union and the United States of America, particularly in respect of the fast breeder reactor and nuclear research.
When we think of our role in Europe, those of us who are internationalists and


who are concerned with the socialisation of the Communities know full well that the large bureaucratic system in Brussels is the antithesis of our objectives.
There have been a number of difficulties in Europe and there are many more to come. One contributor to this debate said that the Council of Ministers will have the last word. Does anybody think that the European Parliament, a body that is already seeking more power, will want to give the Council of Ministers the kind of power suggested by one hon. Member? I believe that the contrary will happen.
The hon. Member for Oswestry (Mr. Biffen) described the situation adequately. The process that is in being is designed to take power away from national Governments. Europe is not becoming the outward-looking unit which the European "hot gospellers" in this House suggest. Some of them appear to have been well paid. [HON. MEMBERS: "Oh."] That is the hard truth. It is certainly not as outward-looking as they have said. It is becoming an inward-looking organism, an anti-democratic organisation. Our place in Europe at present does not reflect the will, thoughts and aspirations of the British people.
Those of us who take this stand should not be charged with being anti-European, because that is not true. Those of us who take this stand on Europe are far more daring than those who gave in to romantic notions and who gave the matter such little thought. They responded to "Grimm's Fairy Tales". Surely it is far better to look to realities.
A number of Opposition Members are smiling. Those smiles are as relevant to this debate as are the smiles on the face of dead men, and they are just as hopeful. The Opposition must know that the British people are disillusioned with Europe. Our people were persuaded by the colourful, expensive brochures exhorting them to "Say 'Yes' for Europe". They now regret it. All the promises that were made have been examined and found to be wanting. Those same people are looking to Europe and saying "That is the cause of our price rises." Naturally, those in the Common Market will pooh-pooh such suggestions. But we all know that on the subject of metrication the Government have had to get down on their knees.
Often I hear the pro-Marketeers saying "Let us be good Europeans and do what the French and Germans do." When I have seen the institutions of France, Italy and Germany, when I have seen the disparity between rich and poor there, when I have seen the conditions of the people I say to our people "Do not listen when the romantics tell you about France, Germany and Italy. They are beautiful countries, and we want good relations with them, to co-operate with them in many areas and to pool our resources with them in such things as science and technology. But we have our own way of life, our own institutions, our own qualities and our own aspirations."
Our technological expertise and our research and development are as good as those in Europe—indeed, in many respects they are better. We have more stable institutions and a more reliable democratic process whereby arguments such as those used in the House of Commons can fructify, enlivening and enriching us all.
We sometimes talk affectionately about the House of Commons. We of all people should not be entering into any kind of arrangement such as this so hurriedly as not to question the consequences. It may well be that in course of time a British Government, of whatever colour, will show less haste. I hope they do. I hope that they will heed the old Latin phrase festina lente—hasten slowly—and let evolvement take place. The time could come when we get these instruments right.
The lesson that we must learn is not to be panicked into rushing into these matters. Let us be clear. Our people know full well—far better than some of the potiticians—what the true situation is. Most of those who seek to promote the interests of Europe against its true long-term interests are so anxious to get there at any price that therein lies their very weakness. We must all at least try to say to the Government "Hold steady. Do not rush, because the will of the people will in the end prevail, and it will be reflected more properly and objectively in this House."

11.14 p.m.

Mr. Judd: There is one point that needs clarification before I say anything else. Whatever the problems about documents earlier, I say as a Minister that no blame or criticism attaches to the staff


of the House, whether in the Vote Office or elsewhere. I believe that we all, on both sides of the House, agree that in our staff we have examples of outstanding loyalty and service which are exemplary for the nation as a whole. I would not wish to associate myself in any way with implications or criticisms to the contrary.
This has been a searching and reflective debate. Indeed, that has been true of all the discussions and deliberations in the House on the question of direct elections to the European Parliament. Members have spoken with deep and passionate sincerity and with great commitment. I believe that the House is at its very best when this happens. This has been indicated by a number of speeches, such as those of my right hon. Friend the Member for Battersea, North (Mr. Jay), my hon. Friend the Member for Newham, South (Mr. Spearing), the hon. Member for Oswestry (Mr. Biffen), my hon. Friend the Member for Renfrewshire, West (Mr. Buchan), my hon. Friend the Member for Hartlepool (Mr. Leadbitter) and the hon. Member for Flint, West (Sir A. Meyer).
I should like, in the time available, to try to deal with some of the detailed points which have been made. My right hon. Friend the Member for Battersea, North asked what would happen if we did not approve the order tonight. If we did not approve the order tonight, it is clear that the United Kingdom would not ratify the Act, because we are not able or prepared to ratify that Act, and we have no intention of ratifying it, without the implementing order. A date for the elections could not be fixed by the Community because the Act would not be in force, and this would obviously result in the direct elections being held up.
My hon. Friend the Member for Newham, South and the hon. Member for Mid-Oxon (Mr. Hurd) asked about the long-term objectives for a uniform system of election and where discussion about such a system might originate. Article 138, paragraph 3, of the Treaty of Rome is clear in this respect. A decision of the Council has to be made on a recommendation by the Assembly, but it has to be a unanimous decision. Through our system of accountability of Ministers operating at the Council of Ministers, this must mean that, with the assistance of the

Scrutiny Committee and the other machinery, this House will have the ability to veto any proposal which comes forward from the Assembly.
There were also questions about emoluments from my right hon. Friend the Member for Battersea, North and also from the hon. Member for Banbury (Mr. Marten). I know that this is a source of very deep concern to many Members of the House, whether in the past they have been supporters or opponents of the European Community.
Some of the figures quoted in the Press with regard to the likely level of emoluments that Assembly Members will receive are, as I stated during the Committee consideration of the European Assembly Elections Bill on 16th February, grotesque. Nothing would do more to discredit the European Assembly and undermine the credibility of directly elected Members in British eyes than that they should receive such inflated salaries, so completely out of line with salary and wage levels in the constituencies which they represent. I hope that British Members of the European Assembly who are present here tonight will heed the concern expressed during the debate—and, indeed, the concern expressed on previous occasions as well—and convey its full force to the Assembly.
The subject of debate tonight is not the level of emoluments of directly elected Members—

Mr. Hurd: Is not the Minister slightly misleading the House? Is it not fairly clear that the present nominated European Assembly will not reach a recommendation on this matter?

Mr. Judd: If the hon. Gentleman will bear with me, I am coming to that. The subject of the debate, as I am suggesting, is not essentially the level of emoluments of directly elected Members. What we are debating is an order designating as a Community treaty the Act of the Council of 20th September 1976 and the Decision annexed to it.
The Act of 20th September 1976 does not fix the level of emoluments of Members of the Assembly. That is clear. It merely, in Article 13, sets out the procedure whereby they can be legally determined. This procedure requires a unanimous decision by the Council of Ministers, acting on a proposal from the


Assembly, having consulted the Commission. The Assembly may propose but it will be the Council, acting unanimously, that will dispose.
This Article 13 procedure is not, however, yet operative, as the Act of 20th September 1976 enters into force only after completion of ratification by all member States. As I have already stated, all member States have now ratified the Act except France and the United Kingdom. France is in a position to do so at any time. Approval of the order by the House tonight will also place Britain in a position to proceed to such ratification. It is, therefore, highly desirable that the Act should be brought into effect as soon as possible if the emoluments issue, which has so rightly concerned right hon. and hon. Members during our direct elections debates, can be cleared up before direct elections are held.

Mr. Jay: rose—

Mr. Judd: I wish to deal with the points that were raised. Candidates in direct elections are entitled to know the emoluments they will receive before they are nominated. Even more so are the voters before they go to the polls. It would be harmful to both the status of the Assembly and its directly elected Members if emoluments were still an unresolved issue by 7th June next year and became an election issue. The attention of the voting public would become diverted from the issues of public policy, such as the common agricultural policy, to the inevitably more emotional subjects of pay and allowances. No one would emerge with much credit from electioneering conducted on such a basis.
As I informed the House during the Committee stage of the European Assembly Elections Bill on 16th February, any proposal made by the Assembly to the Council with regard to emoluments under the Article 13 procedure will be submitted to the House under the scrutiny procedure.
Given the lively interest shown by hon. Members in this topic, I should be extremely surprised if the Scrutiny Committee did not recommend it as a priority item for debate by the House. I repeat the assurance that I gave my right hon. and hon. Friends on 16th April that the House will be able to debate the salaries

of directly elected Members before they are fixed by the Council. The Government, in the meantime, have made it clear—I want to underline this—that they are utterly opposed to excessive salaries for directly elected Members which bear no relationship to those received by national parliamentarians.

Mr. Jay: Having said all that, as the Council is to decide will my hon. Friend tell me what the British Government think is approximately the right level of salary?

Mr. Judd: I have just said that we are not prepared to contemplate salaries which bear no relationship to the salary received by national parliamentarians.
Several of my hon. Friends have raised in the same connection the fiscal status of directly elected Members. The position on this is absolutely clear. The directly elected Members will, under Article 4.2 of the Act of 20th September, enjoy only the same privileges and immunities as non-directly elected Members of the Assembly at present enjoy under chapter 3 of the Protocol on Privileges and Immunities annexed to the Merger Treaty of 1965. That is, for example, immunity from detention for opinions expressed and votes cast. The protocol does not accord to Members of the Assembly any special tax status as it does in chapter 5, Article 13, to officials and other servants of the Community who are subjected to Community taxation rather than to national taxation.
Members of the Assembly are not officials and servants of the Community any more than hon. Members of this House are civil servants. They will remain subject to national taxation until such times as member States decide to amend the protocol and change their tax status. This would require a unanimous decision by all members of the Council. I can assure the House that there is no disposition in the Government to agree to any change in the tax status of Members of the European Assembly after direct elections, as, indeed, was made clear to the hon. Member for Banbury in an exchange—to which he himself referred—at Question Time on 27th April with my right hon. Friends the Prime Minister and the Chief Secretary to the Treasury.
I can also assure the hon. Member for Banbury that any proposal to exempt Members of the Assembly from national


taxation which might be presented to the Council of Ministers will be resisted by the Government. Of course, if such a proposal were included in the communication on emoluments to be sent to the Council by the Assembly under the Article 13 procedure, it would be submitted to the Scrutiny Committee of this House.

Mr. John Evans: rose—

Mr. Judd: Electoral regulations were raised by the hon. Member for Mid-Oxon. The Government have started work on the draft regulations to be made under the European Assembly Elections Act for the conduct of the elections. There will probably be two sets of regulations. One set will relate to the conduct of elections under the simple majority system in Britain and the other set will relate to the conduct of elections by STV in Northern Ireland. The Home Office proposes to consult—I am sure that the hon. Member for Mid-Oxon will be relieved to hear this—the political parties and the local authority associations in the preparation of these regulations and to publish them in draft for public comment. The regulations, revised, if necessary, in the light of comments, will be laid before both Houses of Parliament and will be subject to the affirmative resolution procedure.
I was also asked about the state of play in other countries. All member States have now ratified the Council Act of 20th September 1976 except France and ourselves. France has completed all the necessary parliamentatry steps and can ratify at any time. Constitutional practice in other member States differs from our own. Other countries were able to ratify the Council Act before they enacted their electoral law. The necessary electoral law has been passed by France, Denmark, Ireland and Germany. The law is still before the Parliaments in Belgium and Luxembourg. It has not yet been introduced into the respective Parliaments in The Netherlands and Italy. Discussion is proceeding between the political parties in those countries and Bills are expected to be presented shortly.
There will be no requirement to delineate new constituencies in either Italy or The Netherlands, and failure as yet to introduce the required electoral legislation is not in any way expected to

affect the 7th to 10th June 1979 date for direct elections set by the European Council.
What I have said demonstrates, and it is essential that we should understand this, that Britain is not, as is often alleged, the laggard in implementing the commitment of 20th September 1976 to direct elections. Once the House has approved the Order and we can proceed to ratification, we shall be well up in the field and certainly ahead of Belgium, Luxembourg, The Netherlands and Italy.
I want to dwell for a moment on the speeches made by my hon. Friend the Member for Newham, South, the hon. Member for Oswestry and others. I said earlier, and I hope that the House accepts my conviction on this matter, that, although there may be a temptation to dismiss those with whom we disagree at this juncture in history, I feel that hon. Members on both sides who have had strength of commitment throughout these debates in recent months, epitomised by the speeches we have heard tonight, will be thanked for having put the Administration under detailed scrutiny.
This is an enormously significant issue which we are debating. The order has great ramifications for the future of our country. It is unthinkable that we should approach it in any light-hearted or frivolous way. I want to say, as one of the Ministers most intimately involved with the order, that I am grateful for the commitment which has been shown, even if at times it has proved trying and difficult—

Mr. Spearing: Embarrassing.

Mr. Judd: And embarrassing.
May I put this point to the House? I know that there will be profound regrets and disappointment among many people that we are moving forward in this way. I believe that the challenge now to all those in this House, whatever their views about the issue, is to bring all their experience, all their commitment and all their political conviction to bear in fashioning the future of the Community in which we are now involved. The tragedy, for which we would be condemned by history, would be if we at this juncture, when our future is so


intimately intertwined with the Community as a whole, were to be so preoccupied with the old debates that we did not put our energies constructively into working for the future, in the interests of our people an the interests

Question accordingly agreed to.


Resolved,


That the draft European Communities (Definition of Treaties) (No. 4) Order 1978, which was laid before this House on 11th May, be approved.

of all the people of every members State of the European Economic Community.

Question put:—

The House divided: Ayes 111, Noes 52.

Division No. 225]
AYES
[11.29 p.m.


Anderson, Donald
Haselhurst, Alan
Rhodes, James R.


Archer, Peter
Hodgson, Robin
Rhys Williams, Sir Brandon


Armstrong, Ernest
Horam, John
Ridley, Hon Nicholas


Atkins, Rt Hon H. (Spelthorne)
Howells, Geraint (Cardigan)
Rifkind, Malcolm


Barnett, Guy (Greenwich)
Huckfield, Les
Roberts, Michael (Cardiff NW)


Barnett, Rt Hon Joel (Heywood)
Hunt, David (Wirral)
Rodgers, Rt Hon William (Stockton)


Bates, Alf
Hunter, Adam
Roper, John


Beith, A. J.
Hurd, Douglas
Ross, Stephen (Isle of Wight)


Blenkinsop, Arthur
Jones, Alec (Rhondda)
Rowlands, Ted


Booth, Rt Hon Albert
Jones, Barry (East Flint)
Sainsbury, Tim


Boothroyd, Miss Betty
Judd, Frank
Sever, John


Braine, Sir Bernard
Lamborn, Harry
Shaw, Giles (Pudsey)


Brooke, Peter
Lawson, Nigel
Sheldon, Rt Hon Robert


Brown, Hugh D. (Provan)
Lester, Jim (Beeston)
Silkin, Rt Hon John (Deptford)


Cant, R. B.
Luce, Richard
Silkin, Rt Hon S. C. (Dulwich)


Clarke, Kenneth (Rushcliffe)
Lyon, Alexander (York)
Smith, John (N Lanarkshire)


Cocks, Rt Hon Michael (Bristol S)
MacGregor, John
Smith, Timothy John (Ashfield)


Cox, Thomas (Tooting)
McGuire, Michael (Ince)
Snape, Peter


Crawshaw, Richard
Maclennan, Robert
Steel, Rt Hon David


Dalyell, Tam
Marks, Kenneth
Stewart, Ian (Hitchin)


Davidson, Arthur
Marshall, Dr Edmund (Goole)
Stewart, Rt Hon M. (Fulham)


Davies, Rt Hon Denzil
Marshall, Jim (Leicester S)
Stradling Thomas, J.


Davis, Clinton (Hackney C)
Meyer, Sir Anthony
Summerskill, Hon Dr Shirley


Dewar, Donald
Millan, Rt Hon Bruce
Tinn, James


Dormand, J. D.
Morris, Alfred (Wythenshawe)
Wakeham, John


Douglas-Hamilton, Lord James
Morris, Rt Hon Charles R.
Walder, David (Clitheroe)


Duffy, A. E. P.
Morrison, Hon Peter (Chester)
Weatherill, Bernard


Dykes, Hugh
Moyle, Roland
White, Frank R. (Bury)


Eadie, Alex
Mulley, Rt Hon Frederick
Whitehead, Phillip


Ewing, Harry (Stirling)
Murray, Rt Hon Ronald King
Wiggin, Jerry


Foot, Rt Hon Michael
Nelson, Anthony
Williams, Alan Lee (Hornch'ch)


Ford, Ben
Newton, Tony
Woodall, Alec


Gilbert, Rt Hon Dr John
Page, Rt Hon R. Graham (Crosby)
Wrigglesworth, Ian


Golding, John
Pardoe, John



Goodhew, Victor
Parker, John
TELLERS FOR THE AYES:


Grant, John (Islington C)
Price, William (Rugby)
Mr. Ted Graham and


Hardy, Peter
Radice, Giles
Mr. Joseph Harper


Harrison, Rt Hon Walter
Rees, Rt Hon Merlyn (Leeds S)



Hart, Rt Hon Judith
Rees, Peter (Dover &amp; Deal)





NOES


Atkinson, Norman
Fletcher, Ted (Darlington)
Price, C. (Lewisham W)


Bell, Ronald
Forrester, John
Richardson, Miss Jo


Bidwell, Sydney
Gow, Ian (Eastbourne)
Robinson, Geoffrey


Biffen, John
Grocott, Bruce
Rodgers, George (Chorley)


Body, Richard
Hoyle, Doug (Nelson)
Rooker, J. W.


Bradford, Rev Robert
Jay, Rt Hon Douglas
Ross, William (Londonderry)


Brotherton, Michael
Kerr, Russell
Skinner, Dennis


Buchan, Norman
Lamond, James
Spriggs, Leslie


Budgen, Nick
Leadbitter, Ted
Stoddart, David


Callaghan, Jim (Middleton &amp; P)
Loyden, Eddie
Thomas, Ron (Bristol NW)


Canavan, Dennis
Madden, Max
Tilley, John (Lambeth, Central)


Carson, John
Marten, Neil
Urwin, T. W.


Clark, Alan (Plymouth, Sutton)
Maynard, Miss Joan
Wise, Mrs Audrey


Cook, Robin F. (Edin C)
Mikardo, Ian
Woof, Robert


Cowans, Harry
Mitchell, Austin



Ellis, John (Brigg &amp; Scun)
Moate, Roger
TELLERS FOR THE NOES:


Evans, John (Newton)
Molyneaux, James
Mr. Andrew F. Bennett and


Fernyhough, Rt Hon E.
Newens, Stanley
Mr. Nigel Spearing.


Flannery, Martin
Powell, Rt Hon J. Enoch

Orders of the Day — SOLOMON ISLANDS BILL [Lords]

Considered in Committee.

[Mr. BRYANT GODMAN IRVINE in the Chair]

Clause 1 ordered to stand part of the Bill.

Clause 2

EFFECT OF INDEPENDENCE ON BRITISH NATIONALITY

11.41 p.m.

Mr. Christopher Price: I beg to move Amendment No. 1, in page 2, leave out lines 19 to 22 and insert
shall remain a citizen of the United Kingdom and Colonies until he becomes a citizen of the Solomon Islands or takes out other nationality whereupon he shall cease to be a citizen of the United Kingdom and Colonies".

The Second Deputy Chairman (Mr. Bryant Godman Irvine): With this we may take Amendment No. 2, in clause 4, page 4, leave out lines 3 to 7.

Mr. Price: I do not want to detain the Committee for long. [HON. MEMBERS: "Hear, hear."] However, in spite of the howling mob below me, I wish to draw attention to some of the important principles that lie in the Bill and the manner in which the Bill finds itself before us tonight, which is unprecedented in my experience in the House of Commons.
A Business Statement was slipped in when no one was listening—it was unquestioned—on Monday. The Government should not be allowed to get away with that sort of thing. If they intend to make the citizenship provisions of the Bill a precedent for future debates on a Green Paper followed by a White Paper, and, no doubt, on a Bill on citizenship, for various reasons the Bill before us is crucial for the future principles for deciding British citizenship and the various options in the Green Paper. It is for that reason that I tabled the amendment.
I understand that it is the desire of the Government, especially the Home Office, never to be faced again with a Ugandan Asian or Kenyan Asian situation of the sort that has faced us in the past few years. I also understand the real desire of the Solomon Islanders

when they came to make the settlement to get independence on their terms. Their terms, because of the historical make-up of the population in the Solomon Islands, excluded certain citizens from automatic citizenship, as, I understand, the British Government would have wished. Therefore, as has been said in another place, the settlement is regarded as not very satisfactory to the Government but one that they accepted because of the great desire of the Solomon Islanders to have a settlement on that basis.
The issue is why the Government are insisting, for almost the first time in history, on potentially taking away the citizenship of the United Kingdom and Colonies from a group of citizens who may not apply for citizenship, as is their right to apply, by 1980. If we do not discuss the issue and get things right, we may have trouble for ourselves in future. Therefore, I make no apology for raising the matter this evening.
My hon. Friend the Under-Secretary of State will no doubt reply that it is only a small number of individuals who may be affected by the amendment. However, the amendment provides that, instead of turning all those citizens who might not have applied for citizenship by 1980 into British protected persons and taking away the citizenship that in previous independence settlements we have always allowed those who do not take the citizenship of the country in question to retain, we should allow them to keep it and follow precedent instead of starting a new precedent.
Will the Minister explain the difference between the two statuses of citizen of the United Kingdom and Colonies, on the one hand, and British protected person, on the other, into which category the Government want to turn these people? We shall not know how many there are until 1980.
I understand that there are only two substantial differences. One is that a citizen of the United Kingdom and Colonies can transmit his citizenship to the nth generation if he registers in a proper way, whereas a British protected person can do it only once, so his grandchildren cease to have that privilege. A citizen of the United Kingdom and Colonies who comes here is allowed to vote in our elections, whereas a British protected person is not.
It may be said that there is very little difference between the two statuses. The Minister may ask why I should be making such a fuss. I am making a fuss because we are breaking precedent at a time when, if we are to break precedent, we should do so in an orderly manner by discussing the Green Paper and the White Paper and then legislating on citizenship instead of sliding something into a Bill such as this which may be quoted as a precedent. If the Minister uses that argument, it works both ways. I could ask: if there is so little difference between a British protected person and a citizen of the United Kingdom and Colonies—the status that I want these people to keep—why not give way to me?
Next, will the Minister confirm that this will be the first time that, in giving a country independence and in leaving a residual minority, however small, in a situation where those people may become stateless—citizens of nowhere—we have taken away citizenship of the United Kingdom and Colonies?
I want an absolute assurance from the Minister, if the amendment is not to be pressed, that the Government will not quote this Bill in future as having preempted the Green Paper on nationality with regard to dual and single nationality. If the Government were to do that, it would not be the first time. Therefore, I think that we should discuss citizenship properly. We should not have something lumbered on us by means of a Business Statement on Monday and sitting into the middle of the night on Tuesday. I contend that we can read the clauses relating to citizenship in the Bill only in conjunction with the paragraphs relating to nationality and British overseas citizenship in the Green Paper.
The Green Paper suggests that if in future we are to have a new transitional status of British overseas citizenship, both the statuses about which I have been talking should be included within it. If so, why pre-empt it? Why make the jump now? Why not do what we have always done in the past?
We do not know how many citizens are involved. They might number 500 or 1,000. It is intended that instead of their having their present status of citizen of the United Kingdom and Colonies they shall be given the status of British

protected person. What does that status give them? It gives them almost nothing. They will be able to get a British passport, but that will not give them a guarantee that they can go anywhere in particular on that passport.
If a time should come when Britain decides that it is too expensive to keep representation in Honiara, the capital of the Solomon Islands, it will be of even less help. There is no point in being a British protected person if there is no British representation to protect one.
I am sure the Minister will say that we are being generous by giving these residual citizens the status of British protected person. I suspect, however, that that does not amount to much. It could amount to a good deal less in the future.
I move the amendment because, if the Minister is right and the numbers involved are small, in view of the last hundred years of history of the Solomon Islands when they have not had a particularly square deal from the so-called protectorate, we might as well be generous and give them the slightly more favourable status. We should do nothing in independence negotiations to pre-empt the discussions that we shall have on British nationality law.
I apologise to my hon. Friends if I have spoken for a long time, but this is an important problem. I shall listen carefully to the Minister, particularly for his guarantee that we are doing nothing tonight that will be quoted against us in the future. The Solomon Islands are the last protectorate of Britain. Most of the protectorates came from the German colonies after the First World War. If we are ridding ourselves of our last protectorate, why on earth do we increase the number of British protected persons in the world instead of reducing them? I shall need convincing about the proposal.

Sir Bernard Braine: The Committee should be grateful to the hon. Member for Lewisham, West (Mr. Price) for raising this matter in the way that he did. Normally, when an independence Bill is discussed both sides join together in congratulating the Government on achieving a settlement which enables a former dependency to become a sovereign State. It is normally an occasion for congratulations and good wishes.
However, it would seem that the Foreign and Commonwealth Office thinks that hon. Members are not interested in the details, believes that it can slip these odd proposals through and that we shall accept them without question. That is an unfortunate attitude. But two of us questioned the Minister. The more we questioned him, the more doubtful we became about the Government's intentions.
I said on Second Reading that I wish the Bill a swift passage and I have no intention of taking an undue time now. I wish, however, to raise a slightly different aspect of the matter from that which has been quite properly raised by the hon. Member for Lewisham, West.
The first thing that disturbs me and should disturb the Committee is that the Government have reached an independence settlement without tying up satisfactorily the question of the status of all the people who are domiciled in the Solomon Islands. One would think that after all our sad experience in Uganda, Tanganyika and Kenya over the Asian settlers, we would have learnt the lesson that thereafter we should go into independence negotiations determined that there shall be a complete and satisfactory agreement on the question of nationality before legislation is presented to the House. The opportunity to reach such an agreement has not been taken in this case and the Minister's explanation of the Bill's provisions on Second Reading certainly did not satisfy me. The fact that our own citizenship law is in a mess, as the Green Paper makes clear, is no excuse for leaving unresolved the status of people in a British dependency which is moving to independence.
In the case of East Africa, Conservative Ministers and their advisers assumed all too readily that if there were Asians who did not opt for citizenship of their new countries, they would not wish to come here, but would go back to India. That was a facile assumption. Anyone who knew East Africa at the time knew that the ties of many of these people were more with this country. Many of their children had been educated here. One would have thought that this matter would be taken care of in the case of the Solomon Islands.
Instead, we have perpetuated the notion here that some people are British subjects without citizenship, some are British protected persons, and where both are regarded as potential citizens of their new country, there is no clear idea of what will happen if they do not opt for citizenship of the Solomon Islands.
Neither of these two categories has any right of entry into the United Kingdom. But what happens to them if they do not take Solomon Islands citizenship and are unable to find citizenship in any other country? If circumstances changed and they felt obliged to leave the Solomon Islands, where would they go? What rights have they? They have no automatic right to entry into the United Kingdom, yet the Under-Secretary told the House on Second Reading that they would not be left in a limbo, that we would take care of them. What does that mean?
Surely a solemn obligation rests upon the British Government, particularly after all the angry debate on the subject of immigration, to say what they mean. Do they mean that if these people are left without Solomon Islands citizenship and cannot get citizenship anywhere else, we have an automatic obligation to take them into Britain, even though their status is said not to allow that to happen? If that is what is meant then the Government should say so. The British people and Parliament should be told. Yet it was left to three of us to extract these facts from the Under-Secretary, line by line, question by question. That is not the way for the Government to treat the House of Commons.
There is a matter of principle here. There are, I understand, about 5,000 citizens of European and Chinese descent. We should like to have the exact figures. It is a great pity that we have to drag them out of the Under-Secretary. They should have been given on Second Reading. When the Under-Secretary tells us that these people would not be left stranded, what does that mean?
The Under-Secretary did me the courtesy of writing me a letter after the debate, trying to explain what would happen to Gilbertese settlers in the Solomon Islands. I never raised that question. I never mentioned the Gilbertese. The hon. Member for Lewisham, West did so. I did not. The letter was the wrong letter,


written to the wrong person. It was as irrelevant and as meaningless in relation to what I had said as everything else that the hon. Gentleman said on this subject in the debate.
12 midnight
The hon. Gentleman spoke of 5,000 people of European and Chinese extraction. What happens if those of them who do not apply for Solomon Islands citizenships have to leave? Presumably, at a pinch, the Chinese might be accepted into Singapore or Hong Kong. But what of the Europeans who cannot get entry anywhere else? The only conclusion that one can draw from the Under-Secretary's statement is that they will be permitted to come here.
It is no use the Home Secretary shaking his head. If that means that they cannot come here, the Foreign and Commonwealth Office is open to precisely what the hon. Member for Lewisham, West has been saying, namely, that there is a possibility that we are consigning a number of people who have hitherto enjoyed British protection to the limbo, with no right of entry to anywhere, if they cannot obtain citizenship in any other country. The Government cannot have it both ways. The House is entitled to an explanation of Government policy.
We should bear in mind that there are still 2·6 million citizens of the United Kingdom and Colonies in Hong Kong and 190,000 more in Malaysia, India and Africa. We really must have this question tidied up so that we know where we stand. We must be told what are the limits to the residual obligation to take in such people if they are displaced by political circumstances.
Clearly, this opens up the whole question of nationality law. I think that it is unfortunate that this question has had to be raised in connection with a Bill which otherwise, as I have said, would have been accepted with joy on all sides of the House. The matter cannot be dealt with in any great detail here, but I wish to register a protest at the sly way—that is a correct description—in which this provision has been slipped into an independence Bill, in the hope that on a Friday afternoon no one would take any notice. There were three of us present who did take notice—only three of us. I submit, therefore, that the Under-Secretary must come clean and explain

these matters, or else the wrath of the House of Commons will descend upon him.

Mr. Alexander W. Lyon: I rise to support the amendment moved by my hon. Friend the Member for Lewisham, West (Mr. Price) only in the sense that it is better than nothing. The real answer is that Clauses 2 to 6 ought never to have been included in the Bill in their present form, dependent as they are upon the agreement with the Solomon Islanders, which is set out in the White Paper issued by the Government last year, which the hon. Member for Essex, South-East (Sir B. Braine) did not read and I did not read. I suspect that that is as much our fault as the Government's fault.
I think that the Government are to be criticised not on a sly way of getting something through but on the total mismanagement of the negotiations with the Solomon Islanders on this issue. It is that to which I wish to draw attention. I hope, Mr. Deputy Speaker, that if I stray a little wide, you will forgive me, in the light of the fact that I shall not speak again in any Clause stand part debate.
The thing that astonished me was the last paragraph of the speech of the noble Lord, Lord Goronwy-Roberts in the other place, when he said:
Even if it did, everything in this Bill—and here I must speak frankly to the noble Lord
—it is always as well for Ministers to speak frankly—
relating to nationality and citizenship, citizenship is there at the request of the Solomon Islands Ministers and leaders. This is how they wanted it. They wanted the two categories. I do not want to enlarge upon this, but they wanted it in this way; that the indigenous would automatically on Independence Day become Solomon Islands citizens, but that the non-indigenous, including the categories which the noble Lord quoted to me, would have to apply, and I had no recourse but to agree to what the Solomon Islands leaders wanted." [Official Report, House of Lords, 27th April 1978; Vol. 390, c. 2016.]
I just do not understand that. Anyone would think that if there were two parties to an agreement, one of them—and that the most powerful, with the power to pass this legislation to enable the Solomon Islanders to get their independence—had no power in the negotiations to make an agreement which would have been more fair not only to the Solomon Islanders but to this country.
It is clear that we have done again what we did in East Africa, which was the cause of the difficulties which arose in relation to the East African Asians. We have done again what we did in India, which created British subjects without citizenship. When I hear the Minister tell us in due course, as no doubt he will, that the Solomon Islanders have given solemn assurances that the people that we are talking about—5,000 of them as he says, 20,000 on other figures—will be allowed to take the citizenship of the Solomon Islands after independence by registration, all that I can say is that the most solemn assurance were given by East African Governments before they became independent that all people in their countries would be entitled to take citizenship there.
Of course there were some who were reluctant, but there were also some who wanted to take citizenship but found it very difficult because all kinds of devices were put in their way.
The reason that there are 110,000 United Kingdom subjects in Malaysia who are still to some extent our responsibility is that the Malaysian Government have made it difficult for them to take citizenship, even after the most solemn assurances. The reason that we have the status of British subjects without citizenship—a most absurd status—is that the Indian Government gave the most solemn assurances that after independence they would be allowed to take the citizenship of India—but they never have. As a result, they are to some extent our responsibility, in the same way as the East African Asians were.
My hon. Friend has assured me that we are talking only about 5,000 people. For that reason, I do not intend to divide the House, either on this or on any other question, although it had been my intention to do so if it had been a more important issue in this case.
What we have done is continue a pattern that we have followed since 1948 of making decisions about citizenship for the former inhabitants of our colonies which will call for responsibility by the British Government at some future date. We have signed a post-dated cheque. In doing so we have laid ourselves open to taking on responsibilities which at the time we have to take them on we may find

a great embarrassment. Five thousand may not be many, but if 5,000 people were thrown out of the Solomon Islands before 1984 and we were asked to take them into this country, there would nevertheless be a major political outcry.
We could have avoided that by making an agreement with the Solomon Islanders that would have ensured that on Day I everybody living there was a citizen of the Solomon Islands. It would not be a breach of the agreement set out in the White Paper if we were not to include that aspect in this legislation.
It is interesting to not that the agreement is very different in phraseology from the Bill that is before us. The agreement says:
Citizenship of the Solomon Islands shall be acquired on the date of independence by every person who is a member of a group, tribe or line indigenous to the Solomon Islands and every person whose application for citizenship is in accordance with the naturalisation process.

Mr. Arthur Blenkinsop: I am following my hon. Friend's argument with interest, but how would he ensure that an incoming Solomon Islands Government would stand by any guarantee that they would ensure automatically at a certain date that such persons would continue to have citizenship?

Mr. Lyon: I suggest that my hon. Friend reads the Bill. That will tell him who is to be a citizen of the Solomon Islands. We here are deciding who will be citizens of the Solomon Islands—not in respect of future legislation from the Solomon Islands Government. My complaint is that we are deciding this matter on the basis of what the Solomon Islanders want, and not on the basis of what we want. Because that attitude was adopted in 1948 in the British Nationality Act and in subsequent independence legislation, in every case what was decided was that the people who were taking independence should decide the nature of their own nationality law. We have an interest, but at the time we did not think so. We should have made the matter clear then, and perhaps we did not have that foresight to do so. We now know from experience what is wrong.
If this Bill was based on the indepedence legislation for Hong Kong, I can only say that I would have divided the House on it, because there would have


been the most serious implications. We know that in this case only 5,000 people are involved. I am now simply putting up a marker. I am saying to the Government that we can let it go for the Solomon Islands. I still think that the 5,000 people whose status will be ambiguous after this legislation is passed are too many. Nevertheless, it is a small number—and, if the worst came to the worst, it is a number that we could accommodate.
Of course, that would not happen in the case of Hong Kong. The arguments there is that there is no small group in Hong Kong who could be treated differently from the Chinese in Hong Kong. Therefore, an anomaly of this kind is not likely to arise.
I do not know enough about the separate nature of the population of Hong Kong to rebut that, but it may be that there is a difference between the Chinese who have lived on the island and the Chinese in the New Territories and their origins that may cause the future Hong Kong Government to take a line about giving citizenship to all the inhabitants of the New Territories who might well feel that they have to draw the kind of line which the Solomon Islands Government are trying to draw in this legislation.
If we were to have an argument about that, we would have a crowded House, and such a proposal could not be passed at 12 o'clock at night. It would be a serious issue. The Foreign Office should have that in mind when we come to conduct future negotiatins. In future, the noble Lord, Lord Goronwy-Roberts, will not be allowed to tell the other place "We are sorry, we could not get what we wanted, but the Hong Kong Government had to have their way." That may be the case with the Solomon Islands, but not with the Hong Kong Government. If we had been as firm in 1948 and in the independence legislation for the East African Territories. It would never have led to the immigration difficulties that arose thereafter.
12.15 a.m.
When we were pursuing the working party report on which the Green Paper is based, we examined all the possible commitments which this country has to accept in regard to the people who could not be accommodated within any sensible

definition of British citizenship and yet have some kind of citizenship that gave us some kind of liability for them. They are the transitional people, who became our responsibility only because in 1948 we did not have a clearly defined citizenship of the sort that every other independent Commonwealth country took.
There is real difficulty in meeting those cases. We met the difficulty with the East African Asians by allowing them to come here, but there are still 25,000 of them in India about whom the Government have to make up their mind. But that is a commitment that we have to decide. After that, however, there are 110,000 citizens of the United Kingdom in Malaysia whom we have to decide about in the future. Are they to be British citizens under the new legislation or not?
In the Green Paper it is proposed that they should become British overseas citizens. But there are many people in this country who find that idea nauseating and take the view that what we are doing is what we did in 1968—abandoning our commitment to people whose only citizenship is one connected with this country, who have no citizenship of any other country, and who, if we make them British overseas citizens, will have the right of entry into no country whatsoever. It would be a matter of some moral criticism if we were to take that course.
But I believe that we have to take that course. It was my judgment that, in relation to those people, we have to say that we cut them adrift up to the point where we give them a citizenship which does not entitle them to entry into any country. But what we are doing here tonight is adding to their number. We are putting those 5,000 on the total, and when we come to make the decision about the new British nationality Act, these 5,000 will be added to the 110,00 in Malaysia, the 25,000 or so in Singapore and the several thousand in the Mediterranean. They will all be added together, and people will say "We must take them because we have the moral commitment" or "We must not do so because it would be too great a liability for our immigration commitments to take these people on".
Here tonight, here when everything else has happened, here when we have through the whole immigration story, we


are still making the same mistake. Why? Because, Lord Goronwy-Roberts says:
I had no recourse but to agree to what the Solomon Islands leaders wanted."—[Official Report, House of Lords, 27th April 1978; Vol. 390, c. 2016.]
"All I can say is that I wish someone else had been doing the negotiations. It is intolerable that we should have been put in this position yet again. I take the view that I take—making this speech with no vote thereafter—only, because so few people are involved, but the Foreign and Commonwealth Office had better be warned for the next time.

Mr. A. J. Beith: The hon. Member for Lewisham, West (Mr. Price) has done a service to the Committee by putting down this amendment. Indeed, it follows the questions raised by my noble Friend Lord Avebury in another place. It was in answer to those questions that the remarks quoted were made by Lord Goronwy-Roberts.
There is perhaps a danger that the remarks of the hon. Member for York (Mr. Lyon) will be misconstrued in some quarters as implying that we were seeking in some way to influence or control the future of the Solomon Islands Government, but I am sure that that is not what he intended. I agree with his intention to make it clear that there is one issue on which we in these matters do have a very important say, that is, what responsibilities we will retain when we grant independence to what will be a new sovereign State.
The one matter that must be crystal clear in any independence negotiations is which citizens we are subsequently responsible for and which citizens the new sovereign State is subsequently responsible for. It is to me a matter of very great regret that in the negotiations it was not possible, or does not appear to have been possible, to get over to the Solomon Islands leaders that from the beginning of their new sovereign State they really ought to take responsibility for those who have made their home in the Solomon Islands.

Mr. Christopher Price: I take the point that both the hon. Gentleman and my hon. Friend the Member for York (Mr. Lyon) have made, but the hon. Gentleman will be aware that the situation in

Solomon Islands was a very special one. Many of the 5,000 were imported into Solomon Islands against the wishes of Solomon Islanders by the British Government in a particular crisis.
I had some small part in trying to bring the two sides together in the middle of the negotiations. It was a question either of the negotiations breaking down and the Solomon Islands not getting independence at all or of the British Government giving in the way they did. The situation was a little more complicated than has always been apparent, and before more odium is heaped on the head of poor Lord Goronwy-Roberts I think that some of these facts ought to be made clear.

Mr. Beith: I think that no one would underestimate the difficulties which these negotiations encountered, but there can scarcely be a sovereign State to which we have given independence over recent years which has not contained within it some group of people or other who have been brought there at the convenience of British Governments or British interests in the past, and about whose position there was some domestic concern. There is a very long list of States in which that problem has arisen. Many of them are the very States with which we now have difficulties over groups such as the East African Asians.

Sir Bernard Braine: Does the hon. Gentleman recall that there is no better example of what he is saying than the island of Mauritius, where people from Europe, Asia and Africa were brought together under first French and then British colonial rule? When independence approached, this very point was made, but the ultimate settlement was that on the appointed day all those living in Mauritius were deemed to be Mauritian citizens. That was the model. That was the lesson learned from East Africa. Why has it not been applied ever since?

Mr. Beith: My speech is in danger, Mr. Godman Irvine, of becoming a compendium of erudite interventions, but I wish to underline the point that the one legitimate interest that the British Government have, and are entitled to pursue to a very great degree in any negotiations of this kind is in ensuring that they are not left responsible for citizens who can legitimately claim that


their home is in the country to which independence has been given, and who have a rightful claim on citizenship of that country.
The end result that the Bill presents—and the source of the complaints which have come from all sides—is a very unsatisfactory position for any group of people to be put in, that of the British protected person. What are we inviting these people to become—the latter-day Don Pacificos, the people who have a moral claim upon British Governments but whose passport entitlements are more limited than any other category one can think of?
I am bound to say that I cannot imagine the British Government being able in future years, if they were confronted with a group of such people being dispossessed of the right of citizenship by a country such as Solomon Islands, being able to resist the moral force of the argument "You left these people in this position. You must now do something about it". We had better face that fact now.
The hon. Member for Essex, South-East (Sir B. Braine) posed it as a dilemma. I should be very surprised if any group of British Ministers could resist the force of the argument "You allowed independence to be arrived at in this territory and you left a group of citizens who had no secure claim upon the citizenship of that territory. There is no one else upon whom they can make a claim but you, the British Government". How could we resist the force of that argument in future years? Had we better not admit that now? But that calls to mind all the problems associated with British nationality which we are now mulling over in the context of the Green Paper and the general intention to try to get a new British nationality Act. The precedents are frightening but the particular instance created here is frightening.
Assurances have been given as to the apparent near certainty that applications made by people in this group will all be granted and processed within the time available, but none of this seems to me to obviate the prime responsibility of the British Government to ensure that on the outcome of any independence negotiations they know who their citizens will be in the future, that they know to whom they have effectively transferred citizenship in another country, and that those concerned

know upon whom they have claims and the extent of those claims. This does not seem to apply to this group of people, and I believe that it leaves us trouble in store for the future.

Mr. Richard Luce: There should be no misunderstanding—I am sure that there is not—that, despite the fact that we are debating some rather sensitive citizenships problems with regard to the Solomon Islands, there is nevertheless, a great deal of good will on both sides of the Committee with regard to the future of the Solomon Islands and their proceeding towards independence as soon as possible. Indeed, Mr. Goodman Irvine, I believe that I am right in saying that you yourself know the Solomon Islands. I am sure that you have taken a great deal of interest in these proceedings.
As the hon. Member for York (Mr. Lyon) so rightly highlighted, the problem stems from the unusual nature of this independence Bill, in that the the request of the Solomon Islands, and with the consent of the British Government, we have allowed these clauses to be inserted in the Bill which means that certain existing non-indigenous citizens, or people living in the Solomon Islands, will not automatically be able to become citizens overnight when the Solomon Islands obtain independence. Equally, we are discussing this matter against the background of the confusion of our citizenship laws, about which we all know.
I should like to ask the Minister to clarify two points. The first concerns the scale of the problem. A figure of 5,000 people has been mentioned from several sources. This emanated originally from another place. I should like the Minister to tell us what proportion of these 5,000 non-indigenous people are potentially British protected persons once the Solomon Islands have proceeded under present law to independence.
As I understand it, of the 5,000 people about 2,500 are Gilbertese who, if they did not opt for citizenship of the Solomon Islands, would presumably go back to the Gilbert Islands. We are then left with about 2,500 other people of whom perhaps 1,400 are Europeans, Australians or New Zealanders and perhaps 500 are Chinese. It would help the House if the Minister were to say precisely what proportion of these people would potentially be British protected persons under this rather


unusual category of people, so that we knew exactly the scale of the problem about which we were talking.
The second question I should like to ask has been put by my hon. Friend the Member for Essex, South-East (Sir B. Braine) and the hon. Member for Lewisham, West (Mr. Price), namely, what precisely are our obligations to these British protected persons? As I understand from the Green Paper on British nationality law, about 274,000 people at present are British protected persons, of whom the large bulk come from the Solomon Islands and Brunei. I assume this means that the citizens of the Solomon Islands will, on independence, automatically stop being British protected persons. Therefore, the actual number of British protected persons will diminish very substantially indeed.
However, I should like the Minister to clarify this matter and to make it quite clear that this is a unique problem. Will he tell the House precisely what obligation we have to the residual number of people who are likely to be British protected persons? Regrettable though it may be, I believe that even at this stage the Committee should express the hope that as many non-indigenous people as possible will commit themselves to the future of the Solomon Islands. I hope that they will for their sakes and for the sake of those islands. It is important to know precisely what obligation we have to those who fail to obtain citizenship. What does it mean when the Minister says that in the last resort we have obligations to them, for example, under the "statelessness convention"? That was the term he used during Second Reading on Friday. What precisely does that mean?
It is most important that the Minister should clarify these points both for our sakes—because it is our responsibility to determine this matter—and for the sake of those who live in the Solomon Islands.

12.30 a.m.

The Under-Secretary of State for Foreign and Commonwealth Affairs (Mr. Evan Luard): May I deal first with the point made by the hon. Member for Essex, South-East (Sir B. Braine), who suggested, without any justification, that the Government had attempted to slip through these provisions in what he

described as a sly way. If he reflects on it he will realise that that was a grossly unfounded charge and I hope that he will be willing to withdraw it.
As has been pointed out, the fact that these provisions were likely to be in the legislation was apparent in the White Paper published a year ago. Secondly, these provisions were debated at length in the House of Lords recently. The hon. Member will be aware of this if he has followed the proceedings. Thirdly, we arranged to have the Second Reading of the Bill last Friday, at which the hon. Member was present, and when any other hon. Member could have been present. Finally we provided for a Committee stage this evening. I do not see how that was not perfectly reasonable, enabling all hon. Members to raise points of the kind that have been raised. It is totally unjustified to say that we were trying to slip this through the House of Commons.

Sir Bernard Braine: The only conclusion I can draw, if this was not a sly device, a means of getting something through in the hope that the House would not notice it, is that the Government's conduct is inept.

Mr. Luard: That remark is as unjustified as the hon. Member's earlier remark. It has no basis in fact. We are having a normal debate on an independence Bill and it is open to any hon. Member to raise any point he cares to raise. To suggest that we are trying to slip this through without hon. Members noticing is to cast a reflection upon the hon. Member's alertness and awareness of what is going on. I must reject that charge, and I hope that the hon. Member will not revert to such accusations.
The amendment seeks to ensure that inhabitants of the Solomons who are citizens of the United Kingdom and Colonies and who secured that status because of their connection with the Solomons shall not lose that status unless they have already secured some other nationality, either that of the Solomon Islands or some other State.
I deal first with the question of numbers. The number likely to be involved is a small proportion of a total of about 5,000 people who are mainly of three different kinds—Gilbertese, Chinese and European. Of this number, about 2,500 are Gilbertese. They will not be affected


by the provisions that have caused concern because they will remain citizens of the United Kingdom and Colonies by virtue of their Gilbertese origins, until the Gilbert Islands become independent. Therefore we are concerned with perhaps fewer than half, about 2,000—

Mr. Christopher Price: When my hon. Friend says with such confidence that these 2,500 will not be affected because they are citizens of the United Kingdom and Colonies, is he not making that statement on the assumption that they will apply for citizenship? Surely, as the Bill stands, if it should happen that any of these Gilbertese are not citizens, because they did not apply or could not apply for whatever reason, after 7th July 1980, and if they do not want to go back to the Gilbert Islands and take what will probably, but not certainly, be their Gilbert Island citizenship—assuming that the Gilbert Islands are independent by 1980—they will become British protected persons, because that is what it says in the Bill.

Mr. Luard: They would have that opportunity to do so, but for the moment they would remain citizens of the United Kingdom and Colonies, and the assumption would be that they would eventually become nationals of the Gilbert Islands, when the Gilbert Islands became independent.

Mr. Christopher Price: That is an assumption.

Mr. Luard: It is, but it is a reasonable assumption.
We are left with 2,000-odd people, of whom by far the greater majority are likely to register and to become citizens of the Solomon Islands. We are concerned, therefore, with a small proportion, which might be tens, scores and at worst, I would say, hundreds. Of that number, I think that one can assume that by far the greater proportion will exercise that option, because it is the natural thing for them to do. Some have belonged to the Solomon Islands for a considerable period. It is their home. Many have never seen the shores of these islands. Therefore, I think that we are reasonably entitled to assume that a great majority will register within the Solomon Islands.

Mr. Alexander W. Lyon: Will my hon Friend give way?

Mr. Luard: I do not want to give way too often, but I shall on this occasion.

Mr. Lyon: If the assumption that they will all register is correct, why on earth cannot we give them in the Bill, as of right, the citizenship that they will get by registration? If there is no doubt about it, we could do that. If there is a doubt, the possibility is that, if it is only hundreds, some hundreds will be in the same position as those East African Asians who received from previous Ministers assurances similar to those my hon. Friend is now giving to these people.

Mr. Luard: It is perfectly reasonable to assume that most of them will want to register as citizens of the Solomon Islands and will exercise that option. We are concerned with what will happen to them meanwhile, in case some of them do not exercise that option. That is the problem that has been posed in this debate.
This situation arises because of the attitude taken by the Solomon Islands Ministers in the negotiations. Their feelings on the matter are deeply held. They have said that while they would be prepared to confer their citizenship on the non-indigenous people they wanted them to apply for it.
I must stress that the Chief Minister and his colleagues have given firm commitments that all who apply for citizenship will be granted it. We have no reason to doubt that assurance. I think that my hon. Friend will recognise that Ministers of a highly respected Government of an almost independent State who have given assurances of that kind are very unlikely to flout that obligation within the next year or so.

Mr. Alexander W. Lyon: It happened in India.

Mr. Luard: We have no reason to doubt that the vast majority will secure Solomon Islands citizenship by that means.
I have explained that of the 5,000 about half, who come from the Gilbert Islands, will in any case be allowed to remain citizens of the United Kingdom and Colonies after independence, at least


until the Gilbert Islands become independent, because of their connection with the Gilbert Islands colony.

Sir Bernard Braine: rose—

Mr. Luard: This is the last time I shall give way.

Sir Bernard Braine: My intervention is purely on a matter of fact. The Minister is implying that at least half the 5,000 are Gilbertese. He said specifically on Second Reading:
That did not mean that they were not prepared to grant citizenship to the 5,000 other people of European or Chinese extraction."—[Official Report, 19th May 1978; Vol. 950, c. 1021.]
Let us be quite clear about the figures. Are we dealing with 5,000 people of European or Chinese extraction, or only half that number? What the hon. Gentleman is telling the Committee now does not square with what he said on Second Reading.

Mr. Luard: I am trying to clarify the figures for the hon. Gentleman. If he will listen to what I say, he will find that I am giving the exact facts about this question. If one excludes the Gilbert Islanders, there will be just over 2,000 of European and Chinese origin.

Sir Bernard Braine: Then the hon. Gentleman misinformed the House on Second Reading.

Mr. Luard: If the hon. Gentleman will allow me, I shall go on with my own speech.
So that nobody would be left stateless if he or she absolutely refused to apply, the Bill proposes that even if such people have been citizens of the United Kingdom and Colonies solely by connection with the Solomon Islands they should be afforded the status of British protected persons. This is an internationally recognised national status, and it would be wrong to regard anyone holding it as being virtually stateless.
I was asked to explain the difference between being a citizen of the United Kingdom and Colonies and being a British protected person. The status of a British protected person enables the British Government to protect that person when necessary and to issue him with a passport. There is no difference

in respect of immigration rights. Citizens of the United Kingdom and Colonies themselves, if they enjoy that status as a result of their connection with the Solomon Islands, have no entitlement to enter this country, so there is no change in their immigration status. In this respect they will be in no different position from their present position.
The only significant difference is that the status of British protected person is not normally transmissible. The children of such persons will normally automatically become Solomon Island citizens by reason of their birth there. There is no reason to expect that British protected persons from the Solomon Islands will find eventually that they have nowhere to go. There is not the slightest reason to think that they may be expelled, whatever their citizenship. If it were to happen, I can only repeat what I said before—that we cannot say now what view we might take of a situation at some time in the future. It is premature at this stage to foresee such a problem. But if such a situation were to arise I have no doubt that the Government of the day would deal with it responsibly.
I was asked by my hon. Friend the Member for Lewisham, West (Mr. Price) whether this was the first time that we had taken from any group the status of citizen of the United Kingdom and Colonies. This is not the first time. It has been done before in relation to certain citizens of Cyprus, and earlier still in relation to certain people in Burma. It has been forced on the British Government from time to time. However, I stress that this is an abnormal situation because of the position that was taken by the Solomon Islands Government during the negotiations for independence. In our view, this is most unlikely to be a precedent for any other case because we know of no other territory which is likely to become independent where the same situation would arise.
Nor is it an anticipation of the provisions of the Green Paper as was suggested by my hon. Friend the Member for Lewisham, West. The decision reached in this particular case was entirely independent of the proposal in the Green Paper which, after all, is only a discussion document. The Government are not implementing any proposals in that document at present. What we


have done in the present case has resulted entirely from the unforeseen situation that arose from the Ministers of the Solomon Islands Government taking the position that they did and expressing their unwillingness to accept these people immediately and automatically as citizens of the Solomon Islands.
As the hon. Member for Berwick-upon-Tweed (Mr. Beith) pointed out, there are some possibly understandable reasons for this. Many of these people have come from other territories, some in the not-too-distant past, and the Solomon Islands Ministers felt that they were not belongers in the same way as the indigenous people were.
My hon. Friend the Member for York (Mr. Lyon) took a very different position from that taken by my hon. Friend the Member for Lewisham, West and the hon. Member for Essex, South-East. While they were, in effect, saying that the British Government should be accepting a greater degree of responsibility for these people, my hon. Friend the Member for York took the opposite view—that we should not have taken any responsibility for them at all, and that we should have compelled the Solomon Islands Government to take that responsibility. But it is not easy to compel the Government of a State that is virtually independent to undertake obligations which they resolutely refuse to take. We cannot coerce them. We have sought very hard to persuade them, but eventually they completely refused to accept this obligation.
We, rather reluctantly, but knowing that the number was extremely small, decided that on this occasion, as a very great exception, we would agree to take some responsibility. We did not agree to let them remain citizens of the United Kingdom and Colonies who transmitted their citizenship to future generations indefinitely, but to afford them the status of British protected persons, so that the obligation was more limited. However, that gave them a nationality, and they were not left in the position of being totally stateless. I hope that that deals adequately with—

Mr. Alexander W. Lyon: rose—

Mr. Luard: I give way, but it is for the last time.

Mr. Christopher Price: We are in Committee.

Mr. Lyon: I repeat what my hon. Friend says, that we are in Committee. We can always come back to it, but my hon. Friend might as well deal with the issue now. The British protected person cannot transmit his status to his children. That means that his children living in the Solomon Islands would become stateless. The creation of the stateless person would be a breach of the convention. What do we do? In any event, we shall have to commit ourselves. We might as well leave these people as citizents of the United Kingdom and Colonies, because they have everything else apart from the ability to transmit.
12.45 a.m.
My hon. Friend does not realise the power of the House of Commons. If we had really worked ourselves up into a fit, the Bill would not have come this far. If the Bill does not pass through the House of Commons, it does not matter what the Solomon Islanders will not agree to in negotiations. The House of Commons decides what they will get. It decides that in the measure before us. If we had refused the clauses, the Solomon Islanders and the Government would not have had the Bill. We could have told them that in the negotiations. That is what I should have liked to do, and I am only sorry that we did not do it.

Mr. Luard: Obviously my hon. Friend is right when he says that the House of Commons finally decides on matters of this sort. In the final resort it would be open to the House of Commons to exercise its will. I was describing the position of the Government and the way the Government felt, in view of the firmly expressed view of the Government of the Solomon Islands: we should make a special arrangement in this instance. My hon. Friend correctly states that the British protected person cannot transmit citizenship to his children. That was the point that I was making when he intervened. As he would have heard if he had listened to what I was saying earlier, in almost every case the children themselves will acquire the nationality of the Solomon Islands.
It is true that if for any reason that failed to happen and there was a danger of statelessness arising, we would be


bound by the provisions of the statelessness convention, as I mentioned on Friday and as was raised against this evening by the hon. Member for Essex, South-East. I made it clear on Second Reading that in the final resort we were bound by the terms of the statelessness convention.
My hon. Friend the Member for York made comparisons with the situations that has arisen in the past in East Africa and India. He said that we were repeating the follies of the past. I must observe that there are major differences. The most important difference is that of scale. The numbers on those occasions that were left in an ambiguous position were infinitely larger than the number we are now discussing. My hon. Friend said that we are talking about 5,000, but we are talking of only a small proportion of the 5,000. At the end of the day we may find that a small proportion have not registered and are left in a position in which they remain as British protected persons.
Doubt has been cast on whether in giving the Islanders the status of British protected persons we are not conferring upon them some sort of second class status. In almost every respect their status is the same as if they remained citizens of the United Kingdom and colonies. The only major difference is the one that I have mentioned, namely, that they cannot transmit citizenship. However, in either case they would not have the right of immigration to this country. In that sense we are not changing anything. In any event, those concerned will secure diplomatic protection from this country, which is the main reason for someone wishing to acquire a passport of a particular sort.
A very small difference is that British protected persons will not have the right to vote in elections in this country. That is a right that they would have if they remained citizens of the United Kingdom and Colonies. However as they would not be able to come here even if they remained citizens of the United Kingdom and Colonies, that is not an important difference.
I hope that I have answer the major points that have been raised. I stress that we are talking about a protectorate. It has always been a protectorate. Those who come in the small category that we

have been discussing have become citizens of the United Kingdom and Colonies only because of their connection with a protectorate. It is not illogical in that situation to give them the status that goes with a protectorate, namely, that of British protected persons. They are all put into the one category. Of course, some are already British protected persons. We are assimilating the others with that category so that they all have the same status. I hope that only a small proportion will be involved. I hope that their children will have acquired other nationalities. Therefore, we are talking about a short-term temporary problem. I hope that I have said enough to persuade my hon. Friend to seek leave to withdraw the amendment.

Mr. Christopher Price: I think that the last point made by my hon. Friend was not very logical: we get rid of our last protectorate and invent a new category of British protected person.

Mr. Luard: It is there already.

Mr. Price: It is not. The amendment refers to people who at the moment hold the status of citizen of the United Kingdom and Colonies. We are proposing that, if for any reason after 7th July 1980 they are not citizens of the Solomon Islands or any other country, they become British protected persons. I have followed this matter and I know all the reasons why the British Government, in their wisdom, have reached that decision. But it is not logical. Logic demands that we get rid of our last trust territory, our last protectorate, with the last big group of British protected persons in the world that we have. Instead, we are creating some potentially new ones.
I thought that my hon. Friend was a little bland about the Gilbertese. I agree that very few of these people would want to come to Britain. If you went to the Solomon Islands, Sir Meyer, the last place you would—

The First Deputy Chairman (Sir Myer Galpern): Order. I should like to go to Millport, never mind the Solomon Islands.

Mr. Price: That was a hypothetical statement, Sir Myer. Were you to go there, I think that you would not want to come back here. The idea of someone in Melanesia, Polynesia or anywhere in the South Seas wanting to come to Britain


as an escape route is rather far fetched. I accept that. But I want to pose the problem of the Gilbertese. If something goes wrong and they do not go back to the Gilbert Islands or if something goes wrong with the Gilbert Islands Bill, which is not yet on the stocks—there could be problems with the Banabans and Ocean Islands—and it is delayed much longer than the British Government want it to be delayed, the Gilbertese, the biggest of these minorities, might be in a difficult situation.
I understand that the one concession that the Government got out of the Solomon Islanders during the negotiations was that the period of registration for citizenship should be not only the two years following independence, but a period of six months before independence, so that the House could see how things were going.
I understand that of the 5,000 eligible, about 70 applications have so far come in. That is not a significant figure. My view is that if the Gilbertese applied for citizenship, they would all apply. If they do not apply, very few of them will apply. Many of these minority groups within the Solomon Islands will decide to act as groups rather than as individuals. But if something were to go wrong with the assumptions about the Gilbertese taking citizenship or desiring or willing to go back to the Gilbert Islands, they would be in this kind of situation.
The Minister says "There will be no problems, because I assume this, I assume the other". He is making assumptions. If we find that these people are in an unfortunate situation, we should give them the slightly more favourable status.
I had hoped to be wholly convinced by the Ministers' arguments. I fear that I was less than convinced. But, because I desire to allow the Solomon Islands to reach independence, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 2 ordered to stand part of the Bill.

Clauses 3 to 10 ordered to stand part of the Bill.

Schedule agreed to.

Bill reported, without amendment.

Motion made, and Question proposed, That the Bill be now read the Third time.

12.57 a.m.

Mr. Christopher Price: After that somewhat acrimonious short debate—which was useful because it alerted us to the Pacific independence Bills which will come before the House in the next few months and years—it is right not to leave this business without saying something hopeful and positive about the future of the Solomon Islands.
Certain strictures have been made aaginst Lord Goronwy-Roberts, to whom I was PPS 12 years ago. I should like to get it on record that these negotiations were difficult. The Solomon Islanders were justified in insisting on their side of the bargain. They said to the Foreign and Commonwealth Office "If you do not want us to be independent, you can put it off." But the brief of the Foreign Office was to make this country independent by hook or by crook. It is therefore wrong to blame the Islanders. They had clear views about the form of citizenship that they wanted. They knew that the desire of the Foreign Office to make them independent was greater than the desire to exclude future problems.
I congratulate all the Ministers in the Solomon Islands Government who came here, particularly their leader, Peter Kenilorea. I wish the new independent country well. This is the first of the last group of countries of which we are finally to divest ourselves. Most of them are in the Pacific. The Tuvalu Bill is now in the Lords. The Bill dealing with the Gilbert Islands will come next and, with the French, we must try to divest ourselves of the New Hebrides which will be the most difficult. These measures will create small independent countries of islands in the Pacific. In one way we are putting appalling burdens on them. We are expecting Tuvalu, for instance, with only 8,000 people, to try somehow to be viable, to have diplomatic representation and to make its way in the world. The same is true of the Solomon Islands.
Before we pass this Bill, we should be aware of what we are doing. With the increase in territorial limits, as the Law of the Sea Conference gradually extends the areas of national authority, these tiny islands in the Pacific become more and more important. The Russian fleet is all over the Pacific. There will be pressure on these islands to


trade political influence for cash, of which many of them have very little. The Solomon Islanders are in the middle of negotiating a fishing agreement with the Japanese, who have particular connections with those islands since half of the Second World War was fought over these islands.
In wishing the Solomon Islanders well, we should not just say goodbye to them and sever any further connection. They will need all the help of the aid clauses of the White Paper for many years yet. I am very pleased that the Solomon Islands will be applying for membership of the Lomé Convention because in one curious way that convention is taking over from the British Empire a sort of parent responsibility for helping some of these countries which are not economically viable.
At the moment President Giscard d'Estaing is trying to create a sort of French Commonwealth several hundred years after we began ours, but much upon the same lines. It is regrettable that there are islands in the Pacific such as New Caledonia and French Polynesia, which the French, in contrast to our country, are flatly refusing to allow any form of independence. It would be unfortunate if the French entered a period of aggressive, linguistic neo-colonialism, in which there was rivalry in the Pacific as there is in many countries in Africa between the English-speaking and French-speaking countries.
I hope that as the second stage of the Lomé Convention is negotiated the Solomon Islanders will be associated with the negotiations to add a little more Pacific weight to the ACP—the African-Caribbean-Pacific—agreement. That would provide a growing political superstructure. Then, when, as will inevitably happen, the political pressure comes on some of these newly independent countries, as has happened with the Seychelles already, to take up a certain political stance in return for aid, there will at least be an organisation like the Lomé Convention to which they can turn which dispenses its aid with far fewer political strings than is involved with multilateral aid or direct bilateral aid from anywhere else. In leaving the Solomon Islanders to fend for themselves, it may then be possible that we are not leaving them completely

on their own, but that they will have someone to turn to.
In welcoming the Bill and wishing the Solomon Islanders well in their independent status, I hope that the House of Commons will have further contact with them. I hope that some contact is maintained through the EEC, although it is an institution for which I have very little love. I left the European Parliament because I could not stand it. I have just voted against direct elections. But it is an institution within which the Lomé Convention offers some hope of helping these countries through a reasonable period of gestation as they grow to full independence.

Question put and agreed to.

Bill accordingly read the Third time and passed, without amendment.

Orders of the Day — NATIONAL HEALTH SERVICE (BRIGHTON)

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Jim Marshall.]

1.5 a.m.

Mr. Tim Sainsbury: I am glad to have the opportunity to initiate a brief debate this morning on the National Health Service resources available to the Brighton health district.
I should like to make two points clear initially. First, I am not attacking the National Health Service as such, and least of all the devoted work of the medical staff and the nurses, and the commendable efforts of most of the ancillary staff, to provide to all patients the best possible care. I would stress, indeed, that the Hove District Hospital is a model of what can be achieved by way of the best possible care in premises that are over 100 years old. Secondly, I am not calling for additional Government expenditure. I wish that it were available. Indeed, it is a depressing thought that capital spending on the NHS has declined so substantially over the last four years. If the economy had been rather better managed by the Minister's administration, perhaps we would have more money available for the many and evident needs of the NHS.
What I am asking for is a fairer allocation of the available resources for the


Brighton health district, within which is my constituency of Hove. I should explain that I am not asking for this at the expense of the Eastbourne or Hastings health districts, which together with the Brighton health district make up the East Sussex Area Health Authority, because I know that both of those health districts have very similar problems and similar populations to those of the Brighton health district. What I am saying is that the East Sussex AHA as a whole is not getting a fair share of the resources available to the South-East Thames Regional Health Authority.

Mr. Tim Rathbone: Hear, hear.

Mr. Sainsbury: As the Minister knows, the basic method of allocating resources is by means of a formula arrived at by the Resource Allocation Working Party. If for a moment we accept that that formula accurately reflects the need for resources, it is clear that the East Sussex AHA and the Brighton health district are seriously under-funded. The RAWP target allocation for East Sussex last year was £58·5 million, and yet the allocation this year is only £51·75 million—a very considerable shortfall of nearly 15 per cent.
To achieve the full RAWP target by 1986–87 would require an additional £12·5 million to be added to the existing allocation to East Sussex. That gives us an indication of the size of the problem. I do not see how the problem can be reconciled with the Secretary of State's statement in December 1976, when he said:
I am determined that the resources of this national service should be more fairly shared. Redistribution must not only be between regions but within regions.
The Minister quoted that on 3rd March this year, as reported in Hansard for that date, at column 939.
But I would further argue that the RAWP formula does not fairly reflect the needs of Brighton health district and East Sussex AHA. There are several reasons. First, I would cite population growth. Between censuses, area population statistics are always suspect, because they tend to underestimate migratory movements and are likely to understate the population of areas such as Brighton. The population in the area must be

expected to continue to grow over the next decade, and this will continue to exacerbate the severe shortage of health care facilities.
It is calculated that if the RAWP formula remains unchanged and the population forecasts for the county prove fairly accurate East Sussex will require an additional £5·6 million by 1986–87 to provide services for the additional number and changed age structure of the population at that time.
The second reason why I believe that the formula does not accurately reflect the needs is that it takes no account of holiday visitors or student populations. Not only is the area attracting far more holidaymakers but the season is lengthening and students, including language students—a growing area—are present throughout the year.
The third reason is that National Health Service facilities in the area are old and expensive to run and maintain. The area's ability to meet the needs of the population is further aggravated by the age of the buildings, especially the geriatric accommodation. The current valuation of the capital stock is £68·9 million, compared with the RAWP target of £93 million.
But the fourth and by far the most important reason for doubting the RAWP formula being fair is the weighting given to the population make-up. Whilst the formula takes account, perhaps inadequately, of the over-65s, it does not take account of the proportion of over-75s. The Age Concern publication "Profiles of the Elderly" suggests that 35 per cent. of health and personal social service expenditure is devoted to those over 65, who are 17 per cent. of the national population, and no less than 20 per cent. to the over-75s, who are only 5 per cent. of the population. So they need four times the national average expenditure per head. The Brighton health district has 22·6 per cent. of its population over 65 and 9 per cent., which is nearly twice the national average, over 75.
The validity of the standardised mortality ratio for older age groups is highly suspect. That also adversely affects the allocation of funds on the morbidity factor in the RAWP formula for those areas with an above-average elderly population, as in the Brighton health district.
The age structure of the population of East Sussex is perhaps the most outstanding characteristic of the county. A quarter of the residents are over 65 and a tenth are over 75. Population projections by the county show that by 1986 the population will have increased by 32,000 or 5 per cent., but that the total of over-75s will have increased by 26 per cent. to over 84,000, reaching 12 per cent. of the population.
The elderly make heavy demands on nearly all parts of the NHS, and make especially heavy use of hospital beds. It is not always appreciated, however, that this use is of acute hospital beds as well as of geriatric accommodation. The elderly suffer a much higher proportion of acute illness, as well as chronic disease, than other age groups. For example, much of the work of the orthopaedic service is in treating fractures of the hip in old ladies.
The elderly also make heavy use of many high technology and expensive acute services. About one in three of admissions to a coronary care unit are patients aged over 65. The need for cardiac pacemakers also rises steeply with age, as do the need for joint replacements and the use of radiotherapy and chemotherapy for cancer. For example, a population with 24 per cent. aged over 65 would be expected to produce 47 per cent. more malignant disease than the same size of population with an age structure similar to that of England and Wales. That is the sort of position we have in East Sussex. Even such new developments in technology as the whole-body scanner are likely to be used to a considerable extent for elderly patients. Moreover, the social and other difficulties faced by many elderly people means that their length of stay in hospital, even for acute conditions, is longer than for the middle-aged.
All these factors underline the fact that a population with an age structure like that in East Sussex puts considerable pressure on the acute hospital services.
The implications of a population with that age structure for community services are just as great. The simple aim of maintaining reasonable mobility in the elderly requires considerable investment in chiropody services. Common to the proper functioning of hospital day care and community services is the need for an adequate

transport facility. Public services are limited and, in any event, present real difficulties to the elderly, especially those with some disability. This throws a considerable burden on ambulance and hospital care services, which are at present unable to meet all the calls upon them.
Even on the basis of the RAWP formula, Brighton health district is seriously under-funded. These inadequacies in the formula make the shortage of resources that much worse.
Let me give a few brief examples of what this means on the ground. Although in the area there is a desperate shortage of psycho-geriatric beds, it has been possible to open only half of F-block at the Brighton General Hospital, which would provide just the beds needed, with 35 left unused. At this moment there are 35 chronic sick in need of hospital accommodation who cannot be accommodated, mainly because the district has a shortage of 257 beds, or 41 per cent. of its estimated needs. There are excessive waiting lists for non-acute treatment. In Portslade it has not been possible to start on the desperately needed health centre, with the inevitable result that doctors struggling to work under poor conditions are not able to give of their full potential.
I wish to conclude by putting some specific questions to the Minister which I hope he will be able to answer in his reply, or will let me have a reply shortly after this debate.
First, will he review the RAWP formula to ensure that it takes adequate account of the demands on the NHS by the elderly, especially of the over-75s? Secondly, will he undertake to ensure a faster reallocation of resources within the South-East Thames Regional Health Authority? Thirdly, will he as soon as possible come down to Brighton and Hove to examine our problems? I regret that the Minister of State has not yet been able to accept the invitation issued to him by my hon. Friend the Member for Brighton, Kemptown (Mr. Bowden) on the grounds that his diary is full until August. I regret even more that the Secretary of State for Social Services found time this week to visit China rather than East Sussex.

The Minister of State, Department of Health and Social Security (Mr. Roland Moyle): My right hon. Friend was in


East Sussex a few weeks ago, met the area health authority and discussed its problems at a meeting there.

Mr. Sainsbury: I am grateful to the Minister for that intervention. Unfortunately, the right hon. Gentleman did not come down as far as Brighton and Hove to talk to those on the ground, including Members of Parliament.
My final question to the Minister is to ask whether he will undertake that any additional resources that become available are allocated primarily to make up the shortfall in funding in areas such as the Brighton health district.

1.17 a.m.

Mr. Tim Rathbone: rose—

Mr. Deputy Speaker (Sir Myer Galpern): Has the hon. Member for Lewes (Mr. Rathbone) obtained the agreement of the hon. Member for Hove (Mr. Sainsbury) to take part in the debate?

Mr. Rathbone: My hon. Friend has allowed me to associate myself with him in the debate.
Half of the Lewes constituency falls within the Brighton health district. The points made by my hon. Friend apply equally to my constituency as to the rest of the Brighton health district. I wish to congratulate my hon. Friend on instigating the debate and to associate myself on behalf of all my constituents with all he said.

1.18 a.m.

The Minister of State, Department of Health and Social Security (Mr. Roland Moyle): We have had a brief debate on the resources allocated to East Sussex for National Health Service purposes. I am grateful to the hon. Member for Hove (Mr. Sainsbury) for not asking for increased public expenditure. It is a temptation to which Opposition Members sometimes succumb to ask for public expenditure in particular cases while being opposed to it in general. I am glad that in this instance he avoided that pitfall.
My right hon. Friend the Secretary of State for Social Services has spoken a number of times about the Government's commitment to a fairer distribution of financial resources to the NHS in relation to health care needs, not only among the 14 regions of the country, but within the regions as well, because

some of the biggest inequalities are between rich and poor areas in the same region. My right hon. Friend and I are equally determined not to destroy the quality of excellence in the NHS—for example, in teaching, which is absolutely vital for the future of the National Health Service in the opportunities to discover new techniques.
We do not want to put existing basic services at risk. Therefore, the task facing the Health Service under the RAWP is to strike a proper balance. The resources of the NHS are at any one time finite and we have to ensure that no community is deprived. At the same time, we want to ensure that significant imbalances in some regions are straightened out because the South-East Thames Region is a striking example of imbalances within a region.
The problem, with such a wide range of health services available, has always been how to devise a practical means of securing the necessary allocation of provision. From the beginning of the Health Service until fairly recently, successive Governments relied on historical factors, but the experience of relying on such factors was that the resources of the NHS went to the parts of the service where the activity was already greatest and served to increase the disparities between one part of the country and another. That is why we set up the Resource Allocation Working Party, to produce a new approach to the reallocation of resources in the service.
The working party interpreted the objective of its terms of reference as being to stress that there should eventually be equal access to health care for people equally at risk. Para 1.5 of its report said:
Resources allocation is concerned with the distribution of financial resources which are used for the provision of real resources. In this sense it is concerned with the means rather than the end. We have not regarded our remit as being concerned with how the resources are deployed. This must be a matter for the administering authorities and is essentially part of their policy-making planning and decision-making functions in response to central guidelines on national policies and priorities. Resource allocation will clearly have an important influence on the discharge of those functions and be the most critical guideline within which they have to be discharged".
The object of the working party was to set up target allocations, and such


targets were used by the Department and the health authorities for improving and refining. Therefore, on a whole range of questions which the hon. Member put to me, the answer is that work on developing the formula is continuing all the time with a view to refining it and making it more efficient.

Mr. Sainsbury: I stressed the evidence of the over-75s who put a particularly heavy burden on the facilities of the NHS, and that does not appear to be adequately reflected in the formula as it exists. Can the hon. Gentleman assure the House that this point will be very carefully looked at in the light of the evidence now to hand?

Mr. Moyle: I cannot say that it will be looked at in the light of the evidence now to hand, but all these points for the refinement and improvement of the formula will be considered. We are conscious of some of the drawbacks to it, and they are the subject of further research with a view to making it a more sensitive reallocation.
The formula is aimed at producing target allocations, but once we have them there is not a mathematical approach towards achieving them. The targets cannot be mechanistically applied. The element of judgment has to be exercised all the time in deciding what is feasible and what has merit in switching resources towards the various target allocations of regions and areas.
Much depends on the financial resources available and the practicalities of adjusting patient services, and resources allocation has to be linked all the time with NHS planning. We have told the local health authorities that they have to take account of local circumstances and not seek to apply a predetermined rate of change to the process of allocation.
This is what we call the pace of change. It must depend on the ability of above-target areas to rationalise services without disruption to the existing pattern of provision or to teaching or other specialist needs. Nevertheless, my right hon. Friend has told regions that he expects a significant redistribution of revenue to be achieved this year and next year, and if that does not happen the authorities will have to make clear to him just why it is not practical in particular circumstances.
The task facing the South-East Regional Health Authority against the background of this policy is not easy, particularly as the continuing population movement that the hon. Gentleman has drawn attention to is likely to make disparity between the various areas in the region greater rather than less as time goes by.
The regional authority has committed itself to a more equal distribution of resources between the five health areas, and this means switching resources, broadly speaking, from London to East Sussex and Kent. A modest step was taken in this direction in 1976–77, but in 1977–78 it was felt that a temporary halt should be called to it, because a breathing space was needed to deal with various existing commitments, including the necessity of running new facilities and to adjust some overspending in some of the areas.
This year the regional health authority has reduced the revenue allocation to the teaching area by about £1·8 million and has obtained agreement from the Secretary of State to closures and changes of use in the Greenwich and Bexley area which will also make some significant savings available for redistribution to Kent and East Sussex. As a result, East Sussex is getting £600,000 extra from the redistribution exercise and a further £180,000 as a result of the extra money from the National Health Service budget.
There have been one or two alarms and excursions in the local Press about the attitude of Lambeth, Southwark and Lewisham Area Health Authority to the regional health authority's decision to reduce its revenue, but I think that these articles were probably based on a Press misunderstanding of decisions taken by the area and were probably wildly alarmist. Nevertheless, I am quite prepared to concede that there are difficult problems in the area, and my right hon. Friend has invited the chairman of the region and the chairman of the area to meet him to discuss the situation at an early date.
With regard to the regional health authority's longer term strategy, at the last meeting it agreed to pose regional strategic guidelines to its areas which provided for redistribution options, both of them to take effect by 1987–88. The


first was based on a 25 per cent. movement towards target allocations, and the second on a 40 per cent. movement towards target allocations. The area health authorities have been asked to prepare their strategic plans showing what the effect of these options would be on their delivery of services. There will have to be a review of those options by the region when the area health authorities' plans are received.

Mr. Sainsbury: I appreciate that this movement is at least a movement in the right direction, but does the Minister regard it as satisfactory that over such a long period it is only a modest percentage movement towards achieving the target, which I have suggested is in any event probably inadequately reflecting the real needs because of the population make-up, and is in another sense a moving target because the population continues to shift from the over-provided areas to the underprovided areas?

Mr. Moyle: That is really an elaboration of the question the hon. Gentleman put to me about whether I would foresee the RAWP target allocation achievement being speeded up. One cannot be dogmatic, but I should have thought that the 40 per cent. target was the most extreme likely possibility that could be achieved.
The hon. Gentleman must remember that many of the resources of the teaching area, for example, are tied up in the three large teaching hospitals of Guy's, St. Thomas's and King's, and they will to a large extent produce the doctors which places such as East Sussex will need for the future. The hon. Gentleman must bear in mind that in his anxiety to relieve the shortage of health resources in Sussex now he should not mortgage the ability of the NHS to produce the doctors required in East Sussex for the future.
As I said earlier in an intervention in the hon. Gentleman's speech, my right hon. Friend visited East Sussex on 28th April and attended a meeting of the area health authority there. At that meeting, the area health authority discussed the question of resource allocation.
There is, I know, a particular need to provide services for the large elderly population. I think that about a quarter of the population is over 65, and that about one-tenth is over 75. There is also a need for services for the mentally

handicapped, the young chronic sick and the mentally ill. These are all areas to which we have urged health authorities to give priority during the course of their planning.
With regard to the services for the elderly, there is a shortfall of hospital beds in the health district represented by the hon. Gentleman, and there is emphasis on the continuing improvement, therefore, of community health care. Extra health visitors have been appointed specifically to visit elderly people in their homes, and the health district has a very good night nursing service. There are also sufficient beds for the mentally handicapped in the area served by the East Sussex Area Health Authority, but they are poorly distributed. This is something which the health authority has to sort out. Recently, staffing levels have been increased at the Pouchlands Hospital and a children's unit of 18 beds has opened at Foredown. This unit has good community links.
The hon. Gentleman will appreciate that there is a desire with regard to the mentally ill, mentally handicapped and the elderly that as much as possible of the care for these groups will be done by community services rather than by hospital services. Consideration is being given—

Mr. Sainsbury: Does the Minister accept that it is highly desirable that mentally handicapped adults who do not need hospital treatment but who need in-care treatment should have a provision available which is not as elaborate or expensive as full hospital treatment? That is another shortfall which needs to be met.

Mr. Moyle: That, of course, falls primarily within the sphere of social service departments of local authorities. A wide range of care is needed for the elderly, the mentally ill and mentally handicapped in their homes with perhaps meals-on-wheels support at one end and full hospital treatment at the other, ranging from Part III accommodation, day centres, hostel accommodation and facilities of that sort.
Hospital provision for the mentally ill in Brighton does exist, but many of Brighton's patients are in St. Francis's Hospital, Haywards Heath, which is unduly far away from the ideal point


of view. The health district is attaching priority to the provision of facilities for patients within the Brighton district. A start will be made on 1st June when it is planned to bring into use 35 psycho-geriatric beds in a new purpose-built unit at Brighton General Hospital. Eventually the unit will take 70 beds. A new psycho-geriatric day hospital is currently being planned for Hove, and capital provision for that has already been earmarked.
On 1st January 1979 the third phase of development at the Royal Sussex County Hospital will be brought into use. This will include three operating theatres, 40 acute beds and new kitchens. There will also be a whole-body "Cat Scanner" which will offer the local medical staff the very latest in modern X-ray techniques.
Nevertheless, having said all that, we accept that the district and the area remain under-funded. If we are to ensure that the standards of patient care in the health service continue to rise—an aim to which all Ministers at the Department are committed—and if we are to take a more objective view of priorities, the distribution of scarce resources requires us to ensure that there is a much fairer distribution within the South-East Thames region in favour of Kent and East Sussex.
Unless this major redistribution takes place, the demographic change, the increasing number of elderly and the movement of the population from London and its suburbs towards the coast will make the position even worse.
I hope that what I have said will be enough to reassure hon. Members that

the regional health authority and my Department are determined to secure the necessary redistribution of resources. I hope that it also indicates some of the real difficulties, particularly with regard to the production of the appropriate medical manpower, which make it essential that we ensure that change is prosecuted at a realistic pace and that we do not destroy the seed-corn of the National Health Service in trying to achieve justice.
The hon. Gentleman asked whether I would visit Brighton and Hove. I shall look into that. It will probably not be before the autumn, and I shall try to do so then. He asked whether any additional resources would be directed towards areas such as Kent and East Sussex. That depends to some extent upon the current situation and what new projects are being brought on stream at any particular time. Obviously, it is much easier to achieve redistribution by directing new money and extra resources to the less well-funded areas than it is to close down existing services in the well-funded areas and try to direct that money towards the less well-funded ones. Obviously, there is a general tendency to direct additional resources to areas such as Sussex and Kent—

The Question having been proposed after Ten o'clock and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at twenty-six minutes to Two o'clock.